& Analyzing PPE Accounts and Recording PPE Transactions, Including Discontinued Corporation follow, along with its footnote describing Target's accounting for property and equip- The 2014 and 2013 income statements and balance sheets (asset section only) for Target ment. Target's cash flow statement for fiscal 2014 reported capital expenditures of $1,786 million and disposal proceeds for property and equipment of $95 million. No gain or loss was reported on property and equipment disposals. In addition, Target acquired property and equipment through non-cash acquisitions not reported on the statement of cash flows. (Note some numbers were added to make the disclosure complete.) 2003 luced its R&D intensity from possible implications for the company? Operations Consolidated Statements of Operations 2014 (millions) 2012 2013 $71,279 $72,618 72,618 51,278 14,676 71,279 50,039 14,465 $71,960 1,341 73,301 50,568 14,643 467 2,044 (161) 2,129 1,996 (391) Sales... Credit card revenues Total revenues Cost of sales. Selling, general and administrative expenses Credit card expenses. Depreciation and amortization, Gain on receivables transaction. Earnings from continuing operations before interest expense and income taxes.. Net interest expense Earnings from continuing operations before income taxes Provision for income taxes. Net earnings from continuing operations. Discontinued operations, net of tax. 4,535 882 5,170 1,049 5,740 684 3,653 1,204 2,449 (4,085) $(1.636) 4,121 1,427 2,694 (723) 5,056 1,741 3,315 (316) $ 2,999 Net (ossWearnings $ 1,971 Ferry 8278 The 11.57 25.98 75 25,412 5. 1.10 54450 V. Impairments and write-downs (Assume that impairments and write-downs property and equipment account, rather than increasing accumulated depreciation b. Estimate the amount of property and equipment that was acquired through a Consolidated Statements of Financial Position (Asset Section Only January 31, 2015 (5 millions) Assets Cash and cash equivalents, including short-term investments of $ 2.210 $1,520 and $3. 8,790 Inventory..... 1,333 Assets of discontinued operations 1,754 Other current assets. 14,087 Total current assets Property and equipment 6.127 Land 26.614 Buildings and improvements 5,346 Fixtures and equipment 2,553 Computer hardware and software 424 Construction-in-progress (15,106 Accumulated depreciation 25,958 Property and equipment, net 442 Noncurrent assets of discontinued operations 917 Other noncurrent assets. $41.404 Total assets 12. Property and Equipment Property and equipment is depreciated using the straight-line method over estimated useful lives or terms if shorter We amortize leasehold improvements purchased after the beginning of the initiale over the shorter of the assets' useful lives or a term that includes the original lease term, plus anyone that are reasonably assured at the date the leasehold improvements are acquired. Depreciation expense for 2014, 2013 and 2012 was $2,108 million, $1,975 million and $2,027 million, respectively. For income tax purposes, accelerated depreciation methods are generally used. Repair and maintenance.com expensed as incurred and were $715 million in 2014, S643 million in 2013, and $650 in 2012. Facil pre-opening costs, including supplies and payroll, are expensed as incurred. Estimated Useful Lives Lis in years Buildings and improvements Fixtures and equipment. 2-15 Computer hardware and software Long-lived assets are reviewed for impairment when events or changes in circumstances, such as a de sion to relocate or close a store or make significant software changes, indicate that the aste's cang value may not be recoverable. For asset groups classified as held for sale, the carrying value is compas to the fair value less cost to sell. We estimate fair value by obtaining market appraisals, valuations for third party brokers or other valuation techniques Impairments (8 millions) 2014 2013 Impairments included in segment SG&A. Unallocated impairments.. $108 Total impairments 16 $124 REQUIRED a. Prepare journal entries to record the following for 2014: i. Depreciation expense ii. Capital expenditures iii. Disposal of property, plant, and equipment iv. Repair and maintenance costs $59 19 $77 transactions