Kroger Co. is one of the largest retail food companies in the United States as measured by total annual sales. The Kroger Co. operates supermarkets, convenience stores, and manufactures and processes food that its supermarkets sell. Using EDGAR (www.sec.gov) or the company's website, check the company's annual report for the year ended January 30, 2016.
Required:
1. From the income statement, determine the income tax expense for the most recent year. Tie that number to the first table in disclosure Note 5: "Taxes Based on Income," and prepare a summary journal entry that records Kroger's tax expense from continuing operations in the most recent year.
2. In 2015 companies were required to classify their deferred tax assets and liabilities as current or noncurrent. From Kroger's Note 5, calculate the total (current + noncurrent) net deferred tax asset or liability as of January 30, 2016, and January 31, 2015. By how much did that amount change? To what extent did you account for that change in the journal entry you wrote for the first requirement of this case? Speculate as to the explanation of any difference.