The following information was taken from the 2014 annual reports of Walgreens and L Brands (parent company of The Limited) (dollars in millions) REQUIRED Compute the conservatism ratios for both companies and comment on the differences Which company is more conservative, and why Walgreens L Brands ...

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The following information was taken from the 2014 annual reports of Walgreens and L Brands (parent company

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The following information was taken from the 2014 annual reports of Walgreens and L Brands (parent company of The Limited) (dollars in millions):

Walgreens L Brands $5,311 $1,636 Net income before taxes Income tax expense: Current 544 1,095 Deferred (39) 50 $ 594 To

REQUIRED:
Compute the conservatism ratios for both companies and comment on the differences. Which company is more conservative, and why?

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Financial Accounting in an Economic Context

ISBN: 978-1119444367

10th edition

Authors: Jamie Pratt

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Question Posted: Dec 05, 2018 08:02 AM

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The following information was taken from the 2014 annual reports of Walgreens and L Brands (parent company

Question:

Walgreens L Brands $5,311 $1,636 Net income before taxes Income tax expense: Current 544 1,095 Deferred (39) 50 $ 594 Total $1,056 Effective tax rate 0.199 0.363

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Financial Accounting in an Economic Context

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