Analyzing and Interpreting Income Tax Disclosures

The income tax note to the financial statements for Boeing follows.

Net deferred tax assets $($liabilities$)$ at December $31$ were as follows:

$ millionsCurrent YearPrior YearDeferred tax assets$$19,682$$$18,013$Deferred tax liabilities$(14,890)(14,362)$Valuation allowance$(5,059)(3,877)$Net deferred tax assets$/($liabilities$)$$$(267)$$$(226)$

Income tax expense $($benefit$)$ consisted of the following:

Years ended December $31($$ millions$)$Current YearCurrent tax $($benefit$)$ expenseU.S$.$ federal$$(93)$Non$-$U$.$S$227$U$.$S$.$ state$(67)$Total current$$67$Deferred tax $($benefit$)$ expenseU.S$.$ federal$$(99)$Non$-$U$.$S$(5)$U$.$S$.$ state$86$Total deferred$$(18)$

a$.$ What is the amount of income tax expense reported by Boeing?

$ millionsReported tax expense:Answer $1$

b$.$ What total tax expense is attributed to U$.$S$.$ net income?

$ millionsTax expenses on U$.$S$.$ net income:Answer $2$

c$.$ By what amount did Boeing change its valuation allowance during the current year? How did this affect reported deferred tax assets?

Note: Do not use a negative sign.

The allowance Answer $3$increaseddecreased by $Answer $4$ million during the year. This Answer $5$increaseddecreased deferred tax assets by $Answer $6$ million.

d$.$ Had the company not changed the level of the valuation allowance, what would tax expense have been for the current year?

$ millionsTax expense $($benefit$)$:Answer $7$