AutoZone 2002 Annual Report Download - page 34

Notes to Consolidated
Financial Statements
The provision for income tax expense for each of the last three fiscal years consisted of the following:
Year Ended
August 31, August 25, August 26,
(in thousands) 2002 2001 2000
Current:
Federal $ 210,457 $ 144,538 $ 119,259
State 24,060 13,943 9,003
234,517 158,481 128,262
Deferred:
Federal 26,200 (42,380) 35,762
State 2,283 (4,601) 3,576
28,483 (46,981) 39,338
$ 263,000 $ 111,500 $ 167,600
Significant components of the Company’s deferred tax assets and liabilities were as follows:
August 31, August 25,
(in thousands) 2002 2001
Net deferred tax assets:
Net operating loss and credit carryforwards $ 25,590 $ 25,226
Insurance reserves 25,930 22,804
Warranty reserves 30,660 23,684
Closed store reserves 20,398 25,585
Inventory reserves 4,108 14,256
Other 559 24,598
107,245 136,153
Less: Valuation allowance (14,367) (14,792)
$ 92,878 $ 121,361
The following table presents a reconciliation of the provision for income taxes to the amount computed by applying the
federal statutory tax rate of 35% to income before income taxes:
Year Ended
August 31, August 25, August 26,
(in thousands) 2002 2001 2000
Expected tax at statutory rate $ 241,902 $ 100,459 $ 152,317
State income taxes, net 17,123 6,072 8,176
Other 3,975 4,969 7,107
$ 263,000 $ 111,500 $ 167,600
Note F – Interest Expense
Net interest expense for each of the last three fiscal years consisted of the following:
Year Ended
August 31, August 25, August 26,
(in thousands) 2002 2001 2000
Interest expense $ 80,466 $ 102,667 $ 79,908
Interest income
(169) (623) (305)
Capitalized interest (437) (1,379) (2,773)
$ 79,860 $ 100,665 $ 76,830
32 AZO Annual Report