Shires Inc. has a deferred tax asset of $$80,000$ at the end of the year $20$X$1.$ Management assesses that it is more likely than

not that $40\%$ of the deferred tax asset will not be realized in the future. Shires' tax rate is $20\%$ for $20$X$1$ and years thereafter.

What is the valuation allowance and the net deferred tax asset that Shires should report in its balance sheet for $20$X$1?$

Valuation allowance of $$80\mathrm{.}000$ and net DA of $$0$

O Valuation allowance of $$48,000$ and net DTA of $$32,000$

O Valuation allowance of $$32\mathrm{.}000$ and net DTA of $$48\mathrm{.}000$

O Valuation allowance of $$25\mathrm{.}600$ and net DTA of $$54,400$