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PLEASE HELP!! The answer is NOT 10,786 [The following information applies to the questions displayed below.] Delta Air Lines revealed in its 10-K filing that

PLEASE HELP!! The answer is NOT 10,786

[The following information applies to the questions displayed below.]

Delta Air Lines revealed in its 10-K filing that its valuation allowance for deferred tax assets at the end of 2013 was $177 million, dramatically lower than the over $10 billion recorded at the end of 2012. Here is an excerpt from a press report from Bloomberg in January 2014, regarding this allowance: Delta Air Lines Inc. (DAL) led shares of U.S. carriers higher after posting fourth-quarter profit that topped analysts estimates and forecasting an operating margin of as much as 8 percent in this years initial three months. . . . Airlines are benefiting from lower fuel prices, constraints on capacity growth, controls on operating costs and demand thats keeping planes full, said Ray Neidl of Nexa Capital Partners LLC, a Washington-based aerospace and transportation consulting firm. . . . Net income was $8.48 billion, including an $8 billion non-cash gain from the reversal of a tax valuation allowance.

The following is an excerpt from a disclosure note to Deltas 2013 financial statements: NOTE 12. INCOME TAXES (In part) Deferred Taxes The components of deferred tax assets and liabilities at December 31 were as follows ($ in millions):

image text in transcribed Consider the excerpt from Bloombergs press release. Recalculate the effect on Deltas 2013 net income of the change in Deltas valuation allowance for its deferred tax assets.

\begin{tabular}{|c|c|c|} \hline & \multicolumn{2}{|c|}{ December 31} \\ \hline & 2013 & 2012 \\ \hline \multicolumn{3}{|l|}{ Deferred tax assets: } \\ \hline Net operating loss carryforwards & $6,024 & $6,414 \\ \hline Pension, postretirement and other benefits & 4,982 & 6,415 \\ \hline AMT credit carryforward & 378 & 402 \\ \hline Deferred revenue & 1,965 & 2,133 \\ \hline Other & 698 & 881 \\ \hline Valuation allowance & (177) & (10,963) \\ \hline Total deferred tax assets & $13,870 & $5,282 \\ \hline \multicolumn{3}{|l|}{ Deferred tax liabilities: } \\ \hline Depreciation & $4,799 & $4,851 \\ \hline Intangible assets & 1,704 & 1,730 \\ \hline Other & 639 & 285 \\ \hline Total deferred tax liabilities & $7,142 & $6,866 \\ \hline \end{tabular}

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