PART I. Multiple-choice Problems (30 points, 3 points each) Use the following information for questions / and 2. Lansing Co. at the end of 2020, its first year of operations, prepared reconciliation between prelax financial income and taxable income as follows: Pretax financial income $ 1.200.000 Estimated litigation expense 1.000.000 Extra depreciation for taxes 700,000 The estimated litigation expense of $1,000,000 will be deductible in 2021 when it is expected to be paid. Use of the depreciable assets will result in taxable amounts in each of the next four years. The income tax rate is 30% for all years. 1. The deferred tax liability to be recognized is a $510,000 b. $457.500 c. $157,500 d. $210,000 2. What is the correct journal entry to record to record income tax expense, income tax payable and deferred tax asset/liability for 2020 is a. Dr) Income Tax Expense $360,000 Deferred Tax Asset 300,000 Cr) Income Tax Payable 450,000 Deferred Tax Liability 210,000 b. Dr) Income Tax Expense $360,000 Deferred Tax Asset 210,000 Cr) Income Tax Payable 360,000 Deferred Tax Liability 210,000 c. Dr) Income Tax Expense $540,000 Deferred Tax Asset 210,000 Cr) Income Tax Payable 450,000 Deferred Tax Liability 300,000 d. Dr) Income Tax Expense $217,500 Deferred Tax Asset 300,000 Cr) Income Tax Payable 360,000 Deferred Tax Liability 157,500