Barnes and Noble 2002 Annual Report Download - page 40

Download and view the complete annual report

Please find page 40 of the 2002 Barnes and Noble annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 59

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59

10. INCOME TAXES
The Company files a consolidated federal return with
all 80 percent or more owned subsidiaries. Federal and
state income tax provisions (benefits) for fiscal 2002,
2001 and 2000 are as follows:
Fiscal Year 2002 2001 2000
Current:
Federal $ 59,598 62,141 59,055
State 13,503 13,891 13,086
73,101 76,032 72,141
Deferred:
Federal 6,311 ( 25,790) ( 44,390 )
State 811 ( 4,864) ( 8,782 )
7,122 ( 30,654) ( 53,172 )
Total $ 80,223 45,378 18,969
A reconciliation between the provision (benefit) for
income taxes and the expected provision for income
taxes at the federal statutory rate of 35 percent during
fiscal 2002, 2001 and 2000, is as follows:
Fiscal Year 2002 2001 2000
Expected provision
(benefit) for income taxes
at federal statutory rate $ 69,760 38,271 ( 11,549 )
Amortization of non-deductible
goodwill and trade names and
write-down of goodwill -- 1,987 26,669
State income taxes, net of federal
income tax benefit 9,304 5,868 2,798
GameStop undistributed earnings 2,332 -- --
Other, net ( 1,173 ) ( 748 ) 1,051
Provision for income taxes $ 80,223 45,378 18,969
The tax effects of temporary differences that give rise to
significant components of the Company’s deferred tax
assets and liabilities as of February 1, 2003 and
February 2, 2002 are as follows:
February 1, February 2,
2003 2002
Deferred tax liabilities:
Operating expenses $ ( 23,175) ( 19,655 )
Depreciation ( 31,697 ) ( 22,278 )
Gain on equity increase in
GameStop ( 65,306 ) --
Investment in Barnes & Noble.com ( 41,253 ) ( 32,572 )
Goodwill amortization ( 11,241 ) ( 6,132 )
Pension -- ( 5,149 )
GameStop undistributed earnings ( 2,332 ) --
Total deferred tax liabilities ( 175,004 ) ( 85,786 )
Deferred tax assets:
Lease transactions 26,260 23,446
Investments in equity securities 15,597 9,072
Estimated accruals 11,638 5,573
Restructuring charge 12,853 13,496
Inventory 19,116 15,408
Pension 2,296 --
Insurance liability 6,824 2,312
Unrealized holding losses on
available-for-sale securities 26 9,199
Unrealized holding loss on
derivative instrument 2 936
Other 187 913
Total deferred tax assets 94,799 80,355
Net deferred tax liabilities $ ( 80,205 ) ( 5,431 )
Deferred income taxes are classified on the Company’s
balance sheet as follows:
February 1, February 2,
2003 2002
Short-term deferred tax assets
(a)
$39,618 30,747
Long-term deferred tax liabilities ( 119,823 ) ( 36,178 )
$(80,205 ) ( 5,431 )
(a) Reflected as a component of prepaid expenses and other
current assets on the accompanying balance sheet.
[NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS continued ]
39
2002 Annual Report Barnes & Noble, Inc.