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If a company were to depreciate an asset more quickly

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Unformatted text preview: l reporting purposes it creates a deferred tax liability. If a company were to depreciate an asset more quickly for financial reporting purposes than for tax purposes it would create a deferred tax asset (this is not common). Given Disney’s footnote disclosure, it is likely the company is depreciating and amortizing its assets more quickly for tax purposes than for financial reporting purposes. Page 16 of 21 END-OF-CHAPTER MATERIAL DISNEY’S 2009 FINANCIAL STATEMENTS CON SOLI D ATED STATEM EN TS OF I N COM E (in millions, except per share data) 2008 2009 Revenues $ Costs and exp enses 36,149 $ 2007 37,843 $ 35,510 (30,452) (492) (39) 342 (59) (466) (524) (593) 577 581 485 5,658 7,402 7,725 (2,049) (2,673) (2,874) (302) Restru ctu ring and im p airm ent charges (30,400) (302) (177) Other incom e (exp ense) N et interest exp ense Equity in the incom e of investees Incom e from continu ing op erations before income taxes and m inority interests Incom e taxes Minority interests (28,655) (26) 1,004 Incom e from continu ing op erations 3,307 4,427 4,674 Discontinu ed op erations, net of tax — — 13 N et incom e $ 3,307 $ 4,427 $ 4,687 Dilu ted Earnings p er share: Earnings p er share, continu ing...
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