Please explain where do they find the $40 from. (Answer is given at the bottom)!!

The following information relates to Franklin Freightways for its first year of operations (data in millions of dollars):

Pretax accounting income:	$200
Pretax accounting income included:
Overweight fines (not deductible for tax purposes)	5
Depreciation expense	70
Depreciation in the tax return using MACRS:	110

The applicable tax rate is 40%. There are no other temporary or permanent differences. Franklin's balance sheet at the end of its first year would report:

A deferred tax liability of $16 among noncurrent liabilities.

A deferred tax liability of $16 among current liabilities.

A deferred tax asset of $16 among noncurrent assets.

A deferred tax asset of $16 among current assets.

Answer: The deferred tax liability of $16 ($40 40%) would be reported under noncurrent liabilities because the future taxable amount is related to depreciable assets, which are classified as noncurrent.