Karl Company operates in both the beverage and entertainment industries. In June 2013, Karl purchased Good Time, Inc., which produces and distributes motion picture, television, and home video products and recorded music; publishes books; and operates theme parks and retail stores. The purchase resulted in $2.7 billion in goodwill. Since 2013, Karl has undertaken a number of business acquisitions and divestitures (sales of businesses) as the company expands into the entertainment industry. Selected data from a recent annual report are as follows (amounts are in U.S. dollars in millions):

Required:
1. Compute the cost of the property, plant, and equipment at the end of the current year. Explain your answer.
2. What was the approximate age of the property, plant, and equipment at the end of the current year?
3. Compute the fixed asset turnover ratio for the current year. Explain your results.
4. What is €œexcess of cost over fair value of assets acquired€?
5. On the consolidated statement of cash flows, why are the depreciation and amortization amounts added to income from continuingoperations?

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Property, Plant, Equipment, and Intangibles From the Consolidated Balance Sheet Current Year Prior Year Film costs, net of amortization Artists' contracts, advances, and other entertainment assets Property, plant, and equipment, net Excess of cost over fair value of assets acquired From the Consolidated Statement of Income $1,272 761 2,733 3,076 S 991 645 2,559 3,355 Total revenues $9,714 S10,644 From the Consolidated Statement of Cash Flows 880 S 445 Income from continuing operations Adjustment:s: 289 208 (1,618) (241) 265 190 (256) 644 Depreciation Amortization Other adjustments (summarized) Net cash provided by continuing operations From the Notes to the Financial Statements Accumulated depreciation on property, plant, and equipment $1,178 S 1,023