Question
Asahi Kasei Corporation has sales nearly the equivalent of US$10 billion. The company included the following in its balance sheet for the year ended March
Asahi Kasei Corporation has sales nearly the equivalent of US$10 billion. The company included the following in its balance sheet for the year ended March 31, 2011 ( in millions):
Property, plant, and equipment, net of accumulated depreciation | |
Buildings and structures | 177,789 |
Machinery, equipment, and vehicles | 144,220 |
Land | 55,243 |
Lease assets | 5,463 |
Construction in progress | 22,173 |
Other | 13,466 |
Total property, plant, and equipment, net | 418,354 |
Footnote 8 contains the following:
Accumulated depreciation comprises the following ( in millions): | |
Buildings and structures | 231,474 |
Machinery, equipment, and vehicles | 1,047,912 |
Lease assets | 3,118 |
Other | 105,252 |
Total accumulated depreciation | 1,387,756 |
Footnote 2 says, Depreciation is provided for under the declining-balance method for property, plant, and equipment, except for buildings which are depreciated using the straight-line method, at rates based on estimated useful lives of the assets, principally, ranging from 5 years to 60 years for buildings and from 4 years to 22 years for machinery, equipment and vehicles.
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Compute the original acquisition cost of each of the categories of assets listed under Property, Plant, and Equipment.
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Explain why Asahi Kasei shows no accumulated depreciation for land or construction in progress.
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Suppose Asahi Kasei had used straight-line instead of declining-balance depreciation for all asset categories. How would this affect the preceding values shown for Property, Plant, and Equipment?
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