Ford Motor Company Analysis

S. before making any rational decision upon investing in any organization, most investors often tend to assess the financial background of the case in question so as to determine whether or not the organization is likely to yield economic benefits in the future (Banham, 2017). This report aims at coming up with a comprehensive analytical description of the various effects of current and deferred income taxes to the wellbeing of the company. Additionally, this paper wishes to also highlight on the various items that are likely to affect the classification of the two types of income taxes. In most cases, deferred income taxes are often regarded as liabilities that have been efficiently been to the organization’s balance sheet whereas current income tax, on the other hand, is only viewed as a liability in a scenario where it has not been fully settled.

The income statement also issues out the overall deferred tax expenses and current taxes expenses from any ongoing operations that are likely to impact an organization in one way or another (Ford Motor Company, 2017). Depending on the timing, deferred income tax liabilities may be classified as either long-term or short-term liability. The Ford Motor Company has for ears been able to recognize the various penalties related to income tax hence allowing them to be significantly careful when they are coming up with their income statement. As of the 2017 financial year, the corporation was able to register an operating loss (carried forward) amounting to $5 Billion as a result of deferred tax assets worth $1. 8 billion. G. American icon: Alan Mulally and the fight to save Ford Motor Company.