Income Taxes (Tables)

12 Months Ended

Sep. 02, 2012

Income before income taxes is comprised of the following:


	2012		2011		2010
Domestic (including Puerto Rico)	$	1,809	$	1,526	$	1,426
Foreign		958		857		628

Total	$	2,767	$	2,383	$	2,054

The provisions for income taxes for 2012, 2011, and 2010 are as follows:


	2012			2011			2010
Federal:
Current	$	591		$	409		$	445
Deferred		12			74			1

Total federal		603			483			446

State:
Current		100			78			79
Deferred		2			14			5

Total state		102			92			84

Foreign:
Current		312			270			200
Deferred		(17	)		(4	)		1

Total foreign		295			266			201

Total provision for income taxes	$	1,000		$	841		$	731

The reconciliation between the statutory tax rate and the effective rate for 2012, 2011, and 2010 is as follows:


	2012					2011					2010
Federal taxes at statutory rate	$	969		35.0	%	$	834		35.0	%	$	718		35.0	%
State taxes, net		59		2.1			55		2.4			56		2.7
Foreign taxes, net		(61	)	(2.2	)		(66	)	(2.8	)		(38	)	(1.9	)
Other		33		1.2			18		0.7			(5	)	(0.2	)

Total	$	1,000		36.1	%	$	841		35.3	%	$	731		35.6	%

The components of the deferred tax assets and liabilities are as follows:


	2012		2011
Equity compensation	$	79	$	89
Deferred income/membership fees		148		134
Accrued liabilities and reserves		461		429
Other		55		32

Total deferred tax assets		743		684

Property and equipment		522		494
Merchandise inventories		182		164

Total deferred tax liabilities		704		658

Net deferred tax assets	$	39	$	26

A reconciliation of the beginning and ending amount of gross unrecognized tax benefits for 2012 and 2011 is as follows:


	2012			2011
Gross unrecognized tax benefit at beginning of year	$	106		$	83
Gross increases—current year tax positions		15			21
Gross increases—tax positions in prior years		3			10
Gross decreases—tax positions in prior years		(3	)		(6	)
Settlements		(3	)		(1	)
Lapse of statute of limitations		(2	)		(1	)

Gross unrecognized tax benefit at end of year	$	116		$	106