Southwest Airlines 1994 Annual Report Download - page 36

Download and view the complete annual report

Please find page 36 of the 1994 Southwest Airlines 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 42

  • 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

Notes to Consolidated Financial Statements
Southwest Airlines – 1994 Annual Report Page 36
The effective tax rate on income before cumulative effect of accounting changes differed from the federal
income tax statutory rate for the following reasons (in thousands):
Liability Method Deferred Method
1994 1993 1992
Tax at statutory U.S. tax rates $104,833 $90,873 $53,531
Less amount associated with S-Corporation
earnings of Morris (Note 2) - - (3,607)
104,833 $90,873 $49,924
Nondeductible items 3,689 1,361 1,131
State income taxes, net of federal benefit 9,177 6,632 5,124
Effect of increase in U.S. statutory rates -3,957 -
Other, net 2,493 2,530 (363)
Total income tax provision $120,192 $105,353 $55,816
12. Net Income Per Common And Common Equivalent Share
Net income per common and common equivalent share is computed based on the weighted average
number of common and common equivalent shares outstanding (147,305,374 in 1994, 147,144,568 in
1993, and 142,945,890 in 1992). Fully diluted earnings per share have not been presented as the fully
dilutive effect of shares issuable upon the exercise of options under the Company's Stock Option Plans or
conversion of Convertible Subordinated Debentures is anti-dilutive or is not material.