Apple 1995 Annual Report Download - page 33

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Income Taxes
(In millions)
The provision for income taxes
consists of the following:
The foreign provision for income taxes is based on foreign pretax earnings of approximately $572 million, $474 million, and $416 million in
1995, 1994, and 1993, respectively. The tax benefit credited directly to common stock as a result of compensation expense attributable to
employee stock option and purchase plans recognized differently for financial reporting and tax purposes was $15 million in 1995.
Under FAS 109, deferred tax assets and liabilities reflect the future income tax effects of temporary differences between the financial statement
carrying amounts of assets and liabilities and their respective tax bases.
At September 29, 1995, and September 30, 1994, the significant components of the Company's deferred tax assets and liabilities were:
(In millions)
The net change in the total valuation allowance was an increase of $3 million and $11 million in 1995 and 1994, respectively.
31
FAS 109 Method APB 11 Method
1995 1994 1993
Federal:
Current $ 26 $ 61 $ 14
Deferred 113 20 (24)
139 81 (10)
State:
Current 1 6 3
Deferred 15 20 1
16 26 4
Foreign:
Current 89 71 39
Deferred 6 12 20
95 83 59
Provision for income taxes $ 250 $ 190 $ 53
September 29, September 30,
1995 1994
Deferred tax assets:
Accounts receivable and inventory reserves $ 87 $ 141
Accrued liabilities and other reserves 85 126
Basis of capital assets and investments 82 66
Total deferred tax assets 254 333
Less: Valuation allowance 14 11
Net deferred tax assets 240 322
Deferred tax liabilities:
Unremitted earnings of subsidiaries 648 657
Other 27 29
Total deferred tax liabilities 675 686
Net deferred tax liability $ 435 $ 364