Barnes and Noble 1999 Annual Report Download - page 49

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9. Income Taxes
The Company files a consolidated federal return. Federal and
state income tax provisions for fiscal 1999, 1998 and 1997 are
as follows:
Fiscal Year 1999 1998 1997
Current:
Federal $64,454 39,286 26,324
State 15,306 10,146 7,013
79,760 49,432 33,337
Deferred:
Federal 7,193 11,697 9,575
State 2,684 3,064 2,023
9,877 14,761 11,598
Total $89,637 64,193 44,935
A reconciliation between the provision for income taxes and the
expected provision for income taxes at the federal statutory rate
of 35 percent during fiscal 1999, 1998 and 1997, is as follows:
Fiscal Year 1999 1998 1997
Expected provision for
income taxes at federal
statutory rate $76,522 54,799 38,361
Amortization of
non-deductible goodwill
and trade names 1,342 1,251 1,140
State income taxes,
net of federal income
tax benefit 11,694 8,596 5,873
Other, net 79 ( 453 ) ( 439 )
Provision for
income taxes $89,637 64,193 44,935
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS continued
1999 ANNUAL REPORT
48
The tax effects of temporary differences that give rise to significant components of the Company’s deferred tax assets and liabilities
as of January 29, 2000 and January 30, 1999 are as follows:
January 29, 2000 January 30, 1999
Deferred tax liabilities:
Operating expenses $ ( 15,437) ( 12,528)
Depreciation ( 31,289 ) ( 29,829 )
Gain on equity increase in Barnes & Noble.com ( 110,439 ) ( 26,325 )
Total deferred tax liabilities ( 157,165 ) ( 68,682 )
Deferred tax assets:
Inventory 4,312 4,043
Lease transactions 18,664 15,025
Reversal of estimated accruals 4,246 5,692
Restructuring charge 14,537 16,931
Insurance liability 2,673 2,502
Deferred income 4,015 11,411
Unrealized holding losses
on available-for-sale securities 839 --
Other 7,278 5,632
Total deferred tax assets 56,564 61,236
Net deferred tax liabilities $ ( 100,601 ) ( 7,446 )
Deferred tax liabilities are recorded on the deferred income tax line and deferred tax assets are recorded as a component of prepaid
and other current assets in the accompanying balance sheet.