Marsh Co. at the end of 2011, its first year of operations, prepared a reconciliation between pretax financial income and taxable income as follows: Pretax financial income $900,000 Estimated litigation expense $1,200,000 Extra depreciation for taxes ($1,800,000) Taxable income $300,000 The estimated litigation expense of $1,200,000 will be deductible in 2012 when it is expected to be paid. Use of the depreciable assets will result in taxable amounts of $600,000 in each of the next three years. The income tax rate is 30% for all years.

Income tax payable is a. $0 b. $90,000 c. $180,000 d. $275,000 The deferred income tax to be recognized is CURRENT. NONCURRENT a. $180,000 asset. $200,000 payable b. $360,000 payable. $540,000 asseet c. $360,000 asset. $540,000 payable d. $0 asset. $190,000 payable

PLEASE SHOW ALL CALCULATIONS. THANK YOU.