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

Pretax accounting income:	$	300
Pretax accounting income included:
Overweight fines (not deductible for tax purposes)		8
Depreciation expense		80
Depreciation in the tax return using MACRS:		160

The applicable tax rate is 40%. There are no other temporary or permanent differences. Mountain's net income ($ in millions) is:

1. $176.8.
2. $124.
3. $119.4.
4. $118.