Deferred tax assets and deferred tax liability, Financial Accounting

Below are excerpts from Safeway's 2010 Annual Report, including its Consolidated Balance Sheets, a portion of Note E, Lease Obligations, and Note H, Taxes on Income, from the Notes to the Consolidated Financial Statements. Safeway is one of the largest food and drug retailers in North America.

Required:

a) If Safeway had accounted for all its lease transactions as operating leases, how much higher/lower would cumulative net income before taxes have been as of Year-end 2009 and Year-end 2010?

b) If Safeway had accounted for all its lease transactions as operating leases, how much higher/lower would net income before taxes have been for fiscal year 2010?

c) Write the transaction that would restate Safeway's balance sheet as of year-end 2010, if it classified all of its leases as operating leases. Use the tax rate implicit in the deferred tax liability relating to property to calculate the deferred tax asset and deferred tax liability relating to capital leases.

d) Write the accounting journal entry corresponding to recognition of 2010 income tax expense, arising from all tax jurisdictions.

e) Write the accounting journal entry corresponding to recognition of 2010 income tax expense. Make sure to identify any changes in deferred tax assets and deferred tax liability separately. You may assume that Safeway made no corporate acquisitions that would have affected balances in deferred tax accounts.

Posted Date: 3/26/2013 1:49:35 AM | Location : United States







Related Discussions:- Deferred tax assets and deferred tax liability, Assignment Help, Ask Question on Deferred tax assets and deferred tax liability, Get Answer, Expert's Help, Deferred tax assets and deferred tax liability Discussions

Write discussion on Deferred tax assets and deferred tax liability
Your posts are moderated
Related Questions
1. You can buy any quantity of cooking oil at $5 per litre and any quantity of flour at $2 per kilo. You have allocated $20 to spend on cooking oil and flour.    (a) If you choo

Question: (a) ‘Public accounting is often called fund accounting'. Describe what you understand by the term ‘fund accounting'. (b) "What's the difference between nation

Data for 2013 were as follows: PBO, January 1, $244,000 and December 31, $274,000; pension plan assets (fair value) January 1, $190,000, and December 31, $233,000. The projected be

What was the business strategy underlying the merger? How was the acquisition financed? Was it a vertical, horizontal or conglomerate merger?   The strategy behind those merge

Joe has two children, Sydney age 5 and William age 2, that he wants to provide for their education funding.  Currently, tuition is $10,000 per year and tuition inflation is 6%.  Jo


Third Inc. wishes to issue a perpetual callable bond. The current interest rate is 6%. Next year, there is a 30% chance that the interest rate will be 4.5% and a 70% chance that th

Dividends out of the capital profits Dividends out of the capital profits are apportioned on the same basis as dividends out of income (Re. Doughty). (a) Variation of sec

The following figures are taking from the book of Sheen Compnay limited as on december 31,2009 DEBIT SIDE : opening stock Rs 75000 purchases 245000 wages 30000 c

Star Corporation issued both common and preferred stock during 19X6. The stockholders' equity sections of the company's balance sheets at the end of 19X6 and 19X5 follow.