A. Compute PPE turnover for 2021 and 2020. Property, plant and equipment, net for 2019 was $1,350 thousand. Is there any significant change? What assets may not be reflected on Melvilles balance sheet?

B. When does Melville check for asset impairment? What process do they use to assess impairment? Does this follow GAAP guidelines? Do these charges affect cash flows? How should these charges be treated for analysis purposes?

3 ($ thousands) 4 STATEMENTS OF OPERATIONS Melville's plant asset note disclosure follows: 5 Property, Plant, and Equipment 2021 $15,000 6,500 8,500 6,100 2,400 200 2,200 450 $1,750 2020 $12,500 6,200 6,300 4,100 2,200 150 2,050 420 $1,630 6 Net sales 7 Cost of sales 8 Gross profit 9 Selling and administrative expenses 10 Operating Income 11 Interest expense 12 Income before income taxes 13 Provision for income taxes 14 Net income 15 16 17 ($ thousands) 18 ASSETS 19 Current assets 20 Property, plant, and equipment, net 21 Goodwill 22 Other noncurrent assets 23 Total Assets Property, Plant, and Equipment Property, plant, and equipment are stated at cost less accumulated depreciation and amortization. Depreciation is computed using the straight-line method over estimated useful lives of 10 to 30 years for buildings, 3 to 10 years for machinery and equipment, and 10 to 20 years, not to exceed the lease term, for leasehold improvements. Tools, dies, and molds are amortized using the straight-line method over 3 years. Estimated useful lives are periodically reviewed and, where appropriate, changes are made prospectively. The carrying value of property, plant, and equipment is reviewed when events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. Any potential impairment identified is assessed by evaluating the operating performance and future undiscounted cash flows of the underlying assets. When property is sold or retired, the cost of the property and the related accumulated depreciation are removed from the consolidated balance sheet and any resulting gain or loss is included in the results of operations. 31-Dec-21 31-Dec-20 $7,300 1,500 1,900 2,600 $13,300 $6,900 1,450 1,600 1,800 $11,750