Apple Inc. (AAPL) designs, manufactures, and markets personal computers and related software. Apple also manufactures and distributes music players (iPod), mobile phones (iPhone), and smartwatches (Apple Watch) 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): Land and buildings Machinery, equipment, and internal-use software Other fixed assets Accumulated depreciation and amortization Current Year Preceding Year $17,085 69,797 9,075 (58,579) $16,216 65,982 Current year book value (in millions) $ 37,378 ✔ Preceding year book value (in millions) $ 41,304 8,205 (49,099) a. Compute the book value of the fixed assets for the current year and the preceding year. A comparison of the book values of the current and preceding years indicates that they decreased ✓. A comparison of the total cost and accumulated depreciation reveals that Apple purchased $ 870 x million of additional fixed assets, which was offset by the additional depreciation expense of $ 9,480 million taken during the current year. b. Would you normally expect Apple's book value of fixed assets to increase or decrease during the year? Increase
Apple Inc. (AAPL) designs, manufactures, and markets personal computers and related software. Apple also manufactures and distributes music players (iPod), mobile phones (iPhone), and smartwatches (Apple Watch) 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): Land and buildings Machinery, equipment, and internal-use software Other fixed assets Accumulated depreciation and amortization Current Year Preceding Year $17,085 69,797 9,075 (58,579) $16,216 65,982 Current year book value (in millions) $ 37,378 ✔ Preceding year book value (in millions) $ 41,304 8,205 (49,099) a. Compute the book value of the fixed assets for the current year and the preceding year. A comparison of the book values of the current and preceding years indicates that they decreased ✓. A comparison of the total cost and accumulated depreciation reveals that Apple purchased $ 870 x million of additional fixed assets, which was offset by the additional depreciation expense of $ 9,480 million taken during the current year. b. Would you normally expect Apple's book value of fixed assets to increase or decrease during the year? Increase
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Apple Inc. (AAPL) designs, manufactures, and markets personal computers and
related software. Apple also manufactures and distributes music players (iPod),
mobile phones (iPhone), and smartwatches (Apple Watch) 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):
Land and buildings
Machinery, equipment, and internal-use software
Other fixed assets
Accumulated depreciation and amortization
Current Year Preceding Year
$17,085
69,797
9,075
(58,579)
$16,216
65,982
8,205
(49,099)
a. Compute the book value of the fixed assets for the current year and the
preceding year.
Current year book value (in millions) $ 37,378 ✔
Preceding year book value (in millions) 41,304
A comparison of the book values of the current and preceding years indicates that
they decreased ✓. A comparison of the total cost and accumulated depreciation
reveals that Apple purchased $[ 870 x million of additional fixed assets, which
was offset by the additional depreciation expense of $ 9,480 million taken during
the current year.
b. Would you normally expect Apple's book value of fixed assets to increase or
decrease during the year?
Increase
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