Bart, Inc., a newly organized corporation, uses the equity method of accounting for its 30% investment in Rex Co.’s common stock. During 2010, Rex paid dividends of

$300,000 and reported earnings of $900,000. In addition

• The dividends received from Rex are eligible for the 80% dividends received deductions.

• All the undistributed earnings of Rex will be distributed in future years.

• There are no other temporary differences.

• Bart’s 2010 income tax rate is 30%.

• The enacted income tax rate after 2010 is 25%.

In Bart’s December 31, 2010 balance sheet, the deferred income tax liability should be

a. $10,800

b. $ 9,000

c. $ 5,400

d. $ 4,500