Apple Computer, Inc., designs, manufactures and markets personal computers and related software. Apple also manufactures and distributes music players (iPod) and mobile phones (iPhone) along with related accessories and services including online distribution of third-party music, videos, and applications. The following information was taken from a recent annual report of Apple:
Property, Plant, and Equipment (in millions):
|Current Year||Preceding Year|
|Land and buildings||$955||$810|
|Machinery, equipment, and internal-use software||1,932||1,491|
|Office furniture and equipment||115||122|
|Other fixed assets related to leases||1,665||1,324|
|Accumulated depreciation and amortization||1,713||1,292|
a. Compute the book value of the fixed assets for the current year and the preceding year and explain the differences if any.
b. Would you normally expect the book value of fixed assets to increase or decrease during the year?
The cost of holding an asset on a balance sheet of a company is called book value, and it is calculated by netting the item against its accumulated depreciation. However, it is not necessary that book value of asset is same as that of its market value.
Answer and Explanation: 1
a. Computation of book value:
|Current year||Preceeding year|
|Land and building||955||810|
|Machinery, equipment and software||1,...|
See full answer below.
Become a member and unlock all Study Answers
Start today. Try it nowCreate an account
Ask a question
Our experts can answer your tough homework and study questions.Ask a question Ask a question
Learn more about this topic:
fromChapter 3 / Lesson 10
Learn the definition of fixed assets and examine their importance. Explore the various types of fixed assets, identify their characteristics, and see examples.