PLEASE HELP!! The answer is NOT 10,786 [The following information applies to the...
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PLEASE HELP!! The answer is NOT 10,786
[The following information applies to the questions displayed below.]
Delta Air Lines revealed in its 10-K filing that its valuation allowance for deferred tax assets at the end of 2013 was $177 million, dramatically lower than the over $10 billion recorded at the end of 2012. Here is an excerpt from a press report from Bloomberg in January 2014, regarding this allowance: Delta Air Lines Inc. (DAL) led shares of U.S. carriers higher after posting fourth-quarter profit that topped analysts estimates and forecasting an operating margin of as much as 8 percent in this years initial three months. . . . Airlines are benefiting from lower fuel prices, constraints on capacity growth, controls on operating costs and demand thats keeping planes full, said Ray Neidl of Nexa Capital Partners LLC, a Washington-based aerospace and transportation consulting firm. . . . Net income was $8.48 billion, including an $8 billion non-cash gain from the reversal of a tax valuation allowance.
The following is an excerpt from a disclosure note to Deltas 2013 financial statements: NOTE 12. INCOME TAXES (In part) Deferred Taxes The components of deferred tax assets and liabilities at December 31 were as follows ($ in millions):
Consider the excerpt from Bloombergs press release. Recalculate the effect on Deltas 2013 net income of the change in Deltas valuation allowance for its deferred tax assets.