1. U.S. Steel provides the following information in the notes to its financial statements relating to its use of the straight-line method of depreciation. Can you interpret the information contained in the note?
Property, plant and equipment€”Property, plant and equipment is carried at cost. U.S. Steel records depreciation on a modified straight-line or straight-line method utilizing a composite or group asset approach based upon the estimated useful lives of assets. The modified straight-line method, used for certain steel-producing assets in the United States, is based on raw steel production levels. The modification factors applied to straight-line calculations range from a minimum of 85 percent at a production level below 81 percent of capability, to a maximum of 105 percent for a 100 percent production level. No modification is made at the 95 percent production level.
2. U.S. Steel also provides information relating to the balances in its individual property, plant, and equipment accounts, as shown below. In very general terms, how old is the company€™s property, plant, and equipment? Provide support for youranswer.

Transcribed Image Text:

December 31 (in millions) 2008 2007 S 278 S 295 Land and depletable property Buidings Machinery and equipment Leased machinery and equipment. 1,331 13,561 175 1,448 12,869 176 Total 15,345 $14,7 Less accumulated depreciation and depletion 8,669 8,100 Net S 6,676 6,688