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):

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 theyear?

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Current Year Preceding Land and buildings Machinery, equipment, and internal-use softwa Office furniture and equipment Other fixed assets related to leases Accumulated depreciation and amortization Year $ 810 1,491 122 1,324 1,292 $ 955 1,932 115 1,665 1,713