Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Analyzing and Interpreting Effects of TCJA Tax Law Changes Pfizer Inc. reports the following footnote disclosure in its 2 0 1 8 Form 1 0
Analyzing and Interpreting Effects of TCJA Tax Law Changes
Pfizer Inc. reports the following footnote disclosure in its Form K
The following table provides the components of Income from continuing operations before provision benefit for taxes on income:
The following table provides the components of Provision benefit for taxes on income based on the location of the taxing authorities:
a In the fourth quarter of we recorded an estimate of certain tax effects of the TCJA, including i the impact
on deferred tax assets and liabilities from the reduction in the US Federal corporate tax rate from to ii
the impact on valuation allowances and other state income tax considerations, iii the $ billion repatriation tax
liability on accumulated post foreign earnings for which we plan to elect, with the filing of our US Federal
Consolidated Income Tax Return, payment over eight years through that is reported in Other taxes payable in
our consolidated balance sheet as of December and iv deferred taxes on basis differences expected to give
rise to future taxes on global intangible lowtaxed income. As a result of the TCJA, in the fourth quarter of we
reversed an estimate of the deferred taxes that are no longer expected to be needed due to the change to the territorial
tax system.
Required
a What is the amount of income tax expense reported by Pfizer for each year? What amount is current versus deferred?
b What is Pfizer's effective average tax rate for each year?
Note: Round your percentage to one decimal place for example, enter for
c Use the pretax information to determine the effective tax rate for US operations for each year.
Note: Round your percentage to one decimal place for example, enter for
d The footnote includes amounts related to the TCJA of What was the effect on the company's tax expense in and due to the TCJA?
Note: Do not use a negative sign with your answer.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started