PLEASE ANSWER THE FOLLOWING QUESTIONS

a.	What proportion of total assets, does BNSF hold as property and equipment in 2016 and 2015? Does this surprise you?
b.	Compute property and equipment turnover for 2016 and 2015. Property and equipment, net for 2014 was $55,806 million. Explain this ratio.
c.	By what percentage are the assets used up at year-end 2016? What implication does this ratio have for future cash flows at BNSF?
d.	Estimate the useful life on average for the BNSF depreciable assets at year-end 2016. Which of the assets listed in the footnote explain this estimated useful life?

14. The 2016 income statement and balance sheet excerpts) for BNSF Railway are below BNSF Railway Consolidated Statements of Income Year ended December 31 In millions) Revcnucs Opcrating expcnscs: Compensation and benefits 4.769 5,043 5,023 Purchascd services Depreciation and amotaton 2,128 2,00 2,123 Fucl Equipment rents Materials and other Total opcrating expenses Operuting income Interest expense Other expensc, net Income before income laxes ,693 6,775 6,169 Income tax expense Net incomc 15 2014 $19.829 S21,967 523.239 2.418 2,546 2.592 1.934 2,656 4.478 766 S01 67 1,129 1,196 143 13.144 14,243 16,226 6.685 7,24 7.013 992928 33 2.124 2,527 2.300 S3569 S4,248 S 3.869 BNSF Railway Consolidated Balancc Sheets December 31 (in millions) Current assets Cash and cash cquivalcnts Accounts receivable, net Materials and supplics Current portion of defcrred income taxcs Other current assets Total current assets 2016 201 S 3.218 $2,329 1,272 1,198 825 829 0 245 235 337 5.550 4,938 Property and equipment, net of accumulated Goodwill Intangible assets, net Other assets Total assets depreciation of S6,130 and $4,845, respectively 61.250 59,510 14.845 14,845 430 468 2.47 1,942 84.122 S81.203 The footnotes to the financial statements included the following Property and equipment, net (in millions), and the corresponding ranges of estimated useful lives were as follows 2016 Range of Estimated 2016 2015 Uscful ifc Devember 31 Land for transportation purposes Truck structure Other roadway S 6,063 S6,037 22.287 21200 15-50 yeurs 25,990 24.767 7-l0 years 8,338 7.794 7-35 years 2.755 2.629 8-40 ycars 897 9 ycars Freight cars and other cquipment Computer hardware, software, and other 982 Construction in progress 965 .031 67.380 64.355 Totul cost Less accumulated depreciation and (6.130) (4,845) Property and cquipment, net SK1250 S59 510