Question
Cannington Inc. designs, manufactures, and markets personal computers and related software. Cannington also manufactures and distributes music players (cPod), mobile phones (cPhone), and smartwatches (Cannington
Cannington Inc. designs, manufactures, and markets personal computers and related software. Cannington also manufactures and distributes music players (cPod), mobile phones (cPhone), and smartwatches (Cannington Watch) along with related accessories and services, including online distribution of third-party music, videos, and applications. The following information was taken from a recent annual report of Cannington:
Property, Plant, and Equipment (in millions): | ||||
Current Year | Preceding Year | |||
Land and buildings | $494,500 | $286,810 | ||
Machinery, equipment, and internal-use software | 469,775 | 370,875 | ||
Other fixed assets | 598,345 | 449,995 | ||
Accumulated depreciation and amortization | (628,015) | (524,170) |
a. Compute the book value of the fixed assets for the current year and the preceding year.
Current year book value (in millions) | $fill in the blank 1 |
Preceding year book value (in millions) | $fill in the blank 2 |
A comparison of the book values of the current and preceding years indicates that they . A comparison of the total cost and accumulated depreciation reveals that Cannington purchased $fill in the blank 4 million of additional fixed assets, which was offset by the additional depreciation expense of $fill in the blank 5 million taken during the current year.
b. Would you normally expect Canningtons book value of fixed assets to increase or decrease during the year?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started