The income tax disclosure note accompanying the January 31, 2016, financial statements of Walmart is reproduced below:

Deferred Taxes
The significant components of the Company's deferred tax account balances are as follows:

Required:
1. Focusing on only the first part of Note 9, relating current, deferred, and total provision for income taxes, prepare a summary journal entry that records Walmart's 2016 tax expense associated with income from continuing operations.
2. Compare the change in deferred taxes you recorded in your summary journal entry to the actual change in Walmart's net deferred tax liability for fiscal 2016. Do they reconcile? What besides continuing operations might affect deferred taxes?

Transcribed Image Text:

Note 9. Taxes (in part) Income from Continuing Operations Fiscal Year Ended January 31, 2015 $ in millions) Current: 2016 2014 U.S. federal U.S. state and local International $5,562 622 1,400 7,584 6,165 810 1,529 8,504 6,377 719 1,523 8,619 Total current tax provision Deferred: U.S. federal U.S. state and local International (704) (106) (216) (1,026) 6,558 (387) (55) (77) (72) 37 (479) (514) $ 8,105 Total deferred tax expense (benefit) Total provision for income taxes (519) $7,985 January 31, $ in millions) Deferred tax assets: 2016 2015 $ 3,313 3,763 192 1,390 8,658 (1,456) $ 7,202 $3,255 3,395 184 1,119 7,953 (1,504) $6,449 Loss and tax credit carryforwards Accrued liabilities Share-based compensation Other Total deferred tax assets Valuation allowances Deferred tax assets, net of valuation allowance Deferred tax liabilities: $5,813 1,790 1,452 9,055 $1,853 $5,972 1,825 1,618 9,415 $ 2,966 Property and equipment Inventories Other Total deferred tax liabilities Net deferred tax liabilities