Analysis Case: Homestake Mining company on page 19-58 of the e Text. Answer questions a), b) & c) listed under Instructions. Homestake Mining Company Homestake Mining Company is a 120-year-old international gold mining company with substantial gold mining operations and exploration in the United States, Canada, and Australia. At year-end, Homestake reported the following items related to income taxes (thousands of dollars).
Read Financial Statement Analysis Case: Homestake Mining company on page 19-58 of the e Text. Answer questions a), b) & c) listed under Instructions.
Homestake Mining Company is a 120-year-old international gold mining company with substantial gold mining operations and exploration in the United States, Canada, and Australia. At year-end, Homestake reported the following items related to income taxes (thousands of dollars).
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Total current taxes
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$ 26,349
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Total
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(39,436)
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Total income and mining taxes (the provision for taxes per its income statement)
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$(13,087)
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$303,050
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95,275
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Net deferred tax liability
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$207,775
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Note 6: The classification of deferred tax assets and liabilities is based on the related asset or liability creating the deferred tax. Deferred taxes not related to a specific asset or liability are classified based on the estimated period of reversal.
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Tax loss carryforwards (U.S., Canada, Australia, and Chile)
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$71,151
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Tax credit carryforwards
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$12,007
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What is the significance of Homestake's disclosure of “Current taxes” of $26,349 and “Deferred taxes” of $(39,436)?
Explain the concept behind Homestake's disclosure of gross deferred tax liabilities (future taxable amounts) and gross deferred tax assets (future deductible amounts).
Homestake reported tax loss carryforwards of $71,151 and tax credit carryforwards of $12,007. How do the carryback and carryforward provisions affect the reporting of deferred tax assets and deferred tax liabilities?
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