Target's Income Tax Case
A. If Congress voted to eliminate corporate taxes, how would that effect Target’s income
statement and balance sheet? It would definitely have a positive effect on both. The earnings
from “continuing operations” would remain at $4,923, instead of decreasing due to the
provision for income taxes currently stated at $1,602 on the Consolidated Statement of
Operations. This generally means that revenue and net income would increase because of the
lack of income taxes. The balance sheet would see an increase in equity and retained earnings.
These would increase due in fact to the lack of income tax liability.
statement and balance sheet? It would definitely have a positive effect on both. The earnings
from “continuing operations” would remain at $4,923, instead of decreasing due to the
provision for income taxes currently stated at $1,602 on the Consolidated Statement of
Operations. This generally means that revenue and net income would increase because of the
lack of income taxes. The balance sheet would see an increase in equity and retained earnings.
These would increase due in fact to the lack of income tax liability.