=+In addition, following information appeared in the footnotes for the 1998 corporate annual report (figures are in millions).

1998 1997 Noncurrent deferred tax assets:

Benefit plans

$180

$163 Merger related costs 13 12 Operating loss and credit carryforwards 31 33 Valuation allowance

(29)

(31)

Net noncurrent deferred Tax assets

$195

$177 Required:

a. Why do you think Gillette initially showed its income for 1998 to be

$1.428 billion? Discuss.