Mill, which began operations on January 1, 2008, recognizes income from long-term construction contracts under the percentage-of-completion method in its financial statements and under the completed-contract method for income tax reporting. Income under each method follows:

Year Completed-contract Percentage-of-completion 2008 $ -- $300,000 2009 400,000 600,000 2010 700,000 850,000 The income tax rate was 30% for 2008 through 2010. For years after 2010, the enacted tax rate is 25%. There are no other temporary differences. Mill should report in its December 31, 2010 balance sheet a deferred income tax liability of

a. $ 87,500

b. $105,000

c. $162,500

d. $195,000