a. Use the four-year average valuation allowance to deferred tax assets (2012 through 2015) to reformulate the income statement for each of the four years 20122015. See Analyst Adjustments 10.3 for guidance in the reformulation process.
Compute four year average of valuation allowance/deferred tax assets
Round to one decimal place (ex: 0.2345 = 23.5%)
Answer%
Use rounded percentage for subsequent computations.
Round answers to the nearest whole number.
Use negative signs with answers to indicate adjustments that reduce account balances.
| Income Statement Adjustments | 2012 | 2013 | 2014 | 2015 |
| Income tax expense | $Answer | $Answer | $Answer | $Answer |
| Net income | $Answer | $Answer | $Answer | $Answer |
b. Reformulate the balance sheet for each of the four years 20122015.
Use rounded answers computed in part a. to complete the table below.
Use negative signs with answers to indicate adjustments that reduce account balances.
| Balance Sheet Adjustments | 2012 | 2013 | 2014 | 2015 |
| Valuation allowance | $Answer | $Answer | $Answer | $Answer |
| Deferred tax assets | Answer | Answer | Answer | Answer |
| Total assets | Answer | Answer | Answer | Answer |
| Retained earnings | Answer | Answer | Answer | Answer |
Reformulation for Deferred Tax Asset Valuation Allowance Under Armour Inc. reports total tax expense of $154,112 thousand on its income statement for year ended December 31, 2015, and paid cash of $99,708 thousand for taxes. The tax footnote in the company's 10-K filing, reports the following deferred tax assets and liabilities information. December 31 ($ thouands) 2015 2014 Deferred tax assets $ 40,406 33,821 19,999 $ 35,161 24,774 11,398 19,600 16,302 Stock-based compensation Allowance for doubtful accounts and other reserves Accrued expenses Foreign net operating loss carryforward Deferred rent Inventory obsolescence reserves Tax basis inventory adjustment U.S. net operating loss carryforward Foreign tax credits State tax credits, net of foreign impact Deferred compensation 11,005 8,198 5,845 13,991 11,956 10,019 9,217 6,151 4,966 4,733 5,131 4,245 2,080 1858 Other 6,346 4,592 Total deferred tax assets 178,552 133,242 (24,043) (15,550) Less: valuation allowance Total net deferred tax assets 154,509 117,692 Deferred tax liability Property, plant and equipment Intangible asset (31,069) (17,638) (22,820) (7,010) (8,766) (6,424) (627) (612) Prepaid expenses Other Total deferred tax liabilities (63,282) (31,684) $ 91,227 $ 86,008 Total deferred tax assets, net Reformulation for Deferred Tax Asset Valuation Allowance Under Armour Inc. reports total tax expense of $154,112 thousand on its income statement for year ended December 31, 2015, and paid cash of $99,708 thousand for taxes. The tax footnote in the company's 10-K filing, reports the following deferred tax assets and liabilities information. December 31 ($ thouands) 2015 2014 Deferred tax assets $ 40,406 33,821 19,999 $ 35,161 24,774 11,398 19,600 16,302 Stock-based compensation Allowance for doubtful accounts and other reserves Accrued expenses Foreign net operating loss carryforward Deferred rent Inventory obsolescence reserves Tax basis inventory adjustment U.S. net operating loss carryforward Foreign tax credits State tax credits, net of foreign impact Deferred compensation 11,005 8,198 5,845 13,991 11,956 10,019 9,217 6,151 4,966 4,733 5,131 4,245 2,080 1858 Other 6,346 4,592 Total deferred tax assets 178,552 133,242 (24,043) (15,550) Less: valuation allowance Total net deferred tax assets 154,509 117,692 Deferred tax liability Property, plant and equipment Intangible asset (31,069) (17,638) (22,820) (7,010) (8,766) (6,424) (627) (612) Prepaid expenses Other Total deferred tax liabilities (63,282) (31,684) $ 91,227 $ 86,008 Total deferred tax assets, net
