Answer the following questions:

Required:

a-1. Find the discussion of Property, Plant, and Equipment and depreciation methods used by Campbells. Use data from the Campbell Soup Company annual report

	Straight-line method
	Double declining method
	Written down value method

a-2. Why the particular method is used for the purpose described.

	Straight-line depreciation is used for financial reporting purposes because depreciation expense will be lower than under any of the accelerated depreciation methods.
	Straight-line depreciation is used for financial reporting purposes because depreciation expense will be higher than under any of the accelerated depreciation methods.

a-3. What method do you think the company uses for income tax purposes?

	Accelerated depreciation using the MACRS rates is probably used for tax purposes to minimize taxes payable.
	Straight line Method using the MACRS rates is probably used for tax purposes to minimize taxes payable.
	Written down value Method using the MACRS rates is probably used for tax purposes to minimize taxes payable.

b. Calculate the ratio of the depreciation and amortization expense for 2014 reported in the Consolidated Statements of Cash Flows, Supplemental Financial Statement Data to the total cost (not net book value) of property, plant, and equipment reported in the schedule. (Round your percentage answer to 1 decimal place. (eg 32.6))

https://ezto-cf-media.mheducation.com/Media/Connect_Production/bne/marshall_11e/cashflow.jpg

https://ezto-cf-media.mheducation.com/Media/Connect_Production/bne/marshall_11e/financial_statement.png

https://ezto-cf-media.mheducation.com/Media/Connect_Production/bne/marshall_11e/Campbell%20Soup%20Company%20annual%20report.jpg

c. Based on the ratio calculated in part b and the depreciation method being used by Campbells, what is the average useful life being used for its depreciation calculation? (Round your answer to 1 decimal place.)

d. Assume that the use of an accelerated depreciation method would have resulted in 25% more accumulated depreciation than reported at August 3, 2014, and that Campbells consolidated balance sheets would have been affected by the entire difference. By what percentage would this have reduced the retained earnings amount reported at August 3, 2014? (Round your percentage answer to 1 decimal place. (eg 32.6))

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