Capital One 2004 Annual Report Download - page 104
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Significant components of the provision for income taxes attributable to continuing operations were as follows:
Year Ended December 31
2004 2003 2002
Federal taxes $749,800 $614,730 $ 726,626
State taxes 33,849 8,346 5,485
International taxes 35,107 5,914 2,654
Deferred income taxes (2,174) 38,092 (183,370)
Income taxes $816,582 $667,082 $ 551,395
The reconciliation of income tax attributable to continuing operations computed at the U.S. federal statutory tax
rate to income tax expense was:
Year Ended December 31
2004 2003 2002
Income tax at statutory federal tax rate 35.00% 35.00% 35.00%
Other, including international & state taxes (.40) 2.00 3.00
Income taxes 34.60% 37.00% 38.00%
Note 12
Earnings Per Share
The following table sets forth the computation of basic and diluted earnings per share:
Year Ended December 31
(Shares in Thousands) 2004 2003 2002
Numerator:
Income before change in accounting principle $1,543,482 $1,150,879 $899,644
Cumulative effect of accounting change —(15,037) —
Net income $1,543,482 $1,135,842 $899,644
Denominator:
Denominator for basic earnings per share-
Weighted-average shares 235,613 224,832 219,984
Effect of dilutive securities:
Stock options 10,594 8,471 8,224
Restricted stock and units 2,560 800 37
Contingently issuable shares —— 499
Dilutive potential common shares 13,154 9,271 8,760
Denominator for diluted earnings per share-
Adjusted weighted-average shares 248,767 234,103 228,744
Basic earnings per share
Before cumulative effect of accounting change $6.55$ 5.12 $ 4.09
Cumulative effect of accounting change —(0.07) —
After cumulative effect of accounting change $6.55$ 5.05 $ 4.09
Diluted earnings per share
Before cumulative effect of accounting change $6.21$ 4.92 $ 3.93
Cumulative effect of accounting change —(0.07) —
After cumulative effect of accounting change $6.21$ 4.85 $ 3.93
Securities of approximately 218,000, 20,755,000 and 23,000,000 during 2004, 2003 and 2002, respectively, were
not included in the computation of diluted earnings per share because their inclusion would be antidilutive.
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