DuPont reported depreciation expense of $1,308 million on its consolidated financial statements for the period ended December
Question:
DuPont reported depreciation expense of $1,308 million on its consolidated financial statements for the period ended December 31, 2018. The following excerpt is taken from the company’s consolidated balance sheet for the same year:
Analyze:
1. What percentage of the original cost of property, plant, and equipment was depreciated during 2018?
2. What percentage of property, plant, and equipment cost was depreciated as of December 31, 2018?
3. If the company continued to record depreciation expense at this level each year, how many years remain until all assets would be fully depreciated? (Assume no salvage values.)
Analyze Online: Connect to the DuPont website (www.dupont.com). Click on the Investors link to find information on quarterly earnings.
4. What is the most recent quarterly earnings statement presented? What period does the statement cover?
5. For the most recent quarter, what depreciation expense was reported?
Step by Step Answer:
To calculate the percentage of the original cost of property plant and equipment that was depreciated during 2018 we can use the formula Depreciation Expense Original Cost of Property Plant and Equipment x 100 Substituting the given values we get 1308 13906 x 100 94 Therefore 94 of the original cost of property plant and equipment was depreciated during 2018 To calculate the percentage of property plant and equipment cost that was depreciated as of December 31 2018 we can use the formula Accumulated Depreciation Original Cost of Property Plant and Equipment x 100 Substituting the given values we get 1720 13906 x 100 124 Therefore 124 of the property plant and equipment cost was depreciated as of December 31 2018 To determine how many years remain until all assets would be fully depreciated if the company continued to record depreciation expense at this level each year we can use the formula Years to Fully Depreciate Original Cost of Property Plant and Equipment Salvage Value Annual Depreciation Expense Assuming no salvage value we can use the following formula Years to Fully Depreciate Original Cost of Property Plant and Equipment Annual Depreciation Expense Substituting the given values we get 13906 1308 106 years Therefore if the company continued to record depreciation expense at this level each year it would take 106 years to fully depreciate ...View the full answer
College Accounting A Contemporary Approach
ISBN: 9781260780352
5th Edition
Authors: David Haddock, John Price, Michael Farina
