Fsa-Homework5-7

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HW No. 5
Answer the following questions from the textbook:

E6 - 35
Estimating Useful Life and Percent Used Up
The property and equipment footnotes from the Deere &amp; Company balance sheet follows
The property and Depreciation A summary of property and equipment at October 31 follows:

Property and Equipment (millions) | Useful Lives (years) | 2010 | 2009 | Land | | \$113 | \$1,166 | Buildings and building equipment | 23 | 2,226 | 2,144 | Machinery and equipment | 11 | 3,972 | 3,826 | Dies, patterns, tool, etc. | 7 | 1,105 | 1,081 | All other | 5 | 685 | 672 | Construction in process | | 478 | 362 | Total at cost | | 8,579 | 8,501 | Less accumulated depression | | 4,856 | 4,744 | Total | | \$3,723 | \$3,457 |
Is the equipment impaired? Show supporting computations.
d. If the equipment is impaired at the end of the fourth year, compute the impairment loss.

P6 – 42
Estimating Useful Life and Percent Used Up
The property and equipment section of the Abbott Laboratories 2010 balance sheet follows.

Property and equipment, at cost (\$thousands) 2010 2009 2008

Land | \$648,988 | | \$546,204 | | \$509,606 | Buildings | 4,334,236 | | 4,010,439 | | 3,698,861 | Equipment | 11,813,618 | | 11,325,450 | | 10,366,267 | Construction in progress | 577,460 | | 604,813 | | 613,939 | | 17,374,302 | | 16,486,906 | | 15,189,673 |
Less: accumulated depreciation and amortization 9,403,346 8,867,417 7,969,507
Net property and equipment \$7,970,956 \$7,619,489 \$7,219,166

The company also provides the following disclosure relating to the useful lives of its depreciable assets
Property and Equipment—Depreciation and amortization are provided on a straight-line basis over the estimated useful fives of the assets. The following table shows estimated useful lives of property and equipment.
Classification Estimated Useful Lives