Harley Davidson Corporation What amount of deferred tax assets or deferred tax liabilities are on...

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Harley Davidson Corporation 	What amount of deferred tax assets or deferred tax liabilities are on the two most recent years on the balance sheet? What gives rise to these deferred taxes? What information is disclosed in the footnotes related to deferred taxes? Please define a deferred tax asset and deferred tax liability. 	What temporary and permanent differences does the company disclose inits footnotes? What are some other examples of temporary and permanent differences? 	What is the amount of income tax provision in the two most recent years on the income statement? What information is disclosed in the footnotes relating to income tax expense? Does the company have a net operating loss carry forward or carryback? What are the guidelines for carry forwards and carrybacks? 	Does the company have a defined benefit or defined contribution plan? What are the key elements of the plan discussed in the footnotes? What amounts on the balance sheet relate to this plan?What are the differences between defined benefit and defined contribution plans? 	What are the earnings-per-share amounts disclosed on the income statement for the most recent year? What dilutive securities are discussed in the footnotes? Please identify and describe other examples of dilutive securities. How do these impact earnings per share? 	What kind of share-based compensation does the company have? What was the compensation expense for the two most recent years? What are the key elements of this plan discussed in the footnotes? Please identify and describe other types of share-based compensation. 	Does the company use the direct or indirect cash flow presentation method?What is the difference between these two methods? How does the cash flow statement agree to the other financial statements? 	What investing and financing activities does the company have? What are some other examples of investing and financing activities? 	What non-cash transactions does the company have onits cash flow statement? What are some other examples of non-cash transactions? 	Papers must be at least 6-7 pages in length; 10-point font; double-spaced, including a cover page, table of contents, introduction, body of the report, summary or conclusion, and works cited. 	No plagiarism

Robert · Accepted Answer

Harley Davidson – Financial Analysis                                                                                  1 

HARLEY DAVIDSON INC.
Harley Davidson – Financial Analysis                                                                                  2 
 
Introduction: .................................................................................................. Error! Bookmark not defined. 
Deferred Tax Asset and Deferred Tax Liability .............................................................................................. 3 
Temporary and Permanent Differences ........................................................................................................... 4 
Income Tax Provision ..................................................................................................................................... 5 
Defined Benefit Plan & Defined Contribution Plan ........................................................................................ 6 
Earnings per Share .......................................................................................................................................... 7 
Share Compensation ........................................................................................................................................ 7 
Cash Flow Statement ....................................................................................................................................... 8 
Conclusion: ..................................................................................................................................................... 9 
References: .................................................................................................................................................... 10
Harley Davidson – Financial Analysis                                                                                  3 
 
            Introduction: 
Harley Davidson Inc. is a leading motorcycle manufacturer in America. The abbreviation used for the 
company is H-D or Harley and was formerly known as HDI. It is listed under New York Stock Exchange with ticker 
symbol HOG. The company was founded in the first decade of 20
th
 century in Milwaukee Wisconsin. It was 
founded by the Davidson brothers – William, Walter and Arthur along with the William S. Harley. The company 
was among one of the two American motorcycle manufacturers who survived through the Great Depression. Harley 
Davidson faced tough times in its tenure; it has survived from the period of bad quality control and stiff competition 
from the Japanese companies. 
They generally manufacture and sell heavy weight (more than 750 cc) motorcycles which are designed for 
cruising on highways. Harley Davidson motorcycles are generally called as “Harleys” and are famous for the unique 
design and exhaust note. The Harleys are generally known for the tradition of heavy customization which in turn 
gives rise to chopper style of motorcycle. All the Harley Davidson motorcycles represent the styles of classic Harley 
Designs except for modern VRSC model family. The Harley Davidson Inc. tried to establish itself in the market of 
light motorcycle but was not very successful in this venture. The venture was largely abandoned since the sale of 
Italian Aermacchi subsidiary in 1978.The brand community of Harley Davidson is quite loyal through the use of 
clubs, events and museum.  
The mission of the company is to preserve and perpetuate the company through regular up gradation and 
improvement in the quality of product and services and accomplishment of the financial objectives. The main 
mission of the company is to add those manufacturing or service venture that can increase the value (not only profit) 
of the company. Currently the company provides motorcycles, accessories and services to motorcyclists. The 
mission of the company also includes, providing those products and services which enhances Harley-Davidson 
image and attract more customers.  
Deferred Tax Asset and Deferred Tax Liability 
Deferred Tax Asset is an asset on company’s balance sheet which will be used in future to reduce the future 
tax expense. It can arise because of the net loss carryovers. It must be estimated that there is more than 50% 
Harley Davidson – Financial Analysis                                                                                  4 
 
probability that the accounting income of the company will be positive in the future fiscal period before the deferred 
tax asset can be applied. 
Deferred Tax Liability arises due to the temporary differences between the company account balances and 
tax carrying values, the expected and enacted income tax rate and estimated income tax payable for the current year. 
There are differences between the amount a company can deduct for tax and accounting purposes and thus it will 
give rise to the difference in taxable income and income before tax. Deferred Tax Liability shows that the company 
will pay more income tax in future because of a transaction which occurred during current period.  
The Deferred tax Asset worth $132,331 and $146,411 is shown in the company’s balance sheet for the year 
ended on 2011 and 2010 respectively. The principal components of deferred tax asset are as follows:

Harley Davidson Corporation What amount of deferred tax assets or deferred tax liabilities are on the two most recent years on the balance sheet? What gives rise to these deferred taxes? What...

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