Financial information for American Eagle is presented in Appendix A at the end of the book.

Required:

1. The summary of significant accounting policies is located in note 2 to the financial statements. Locate the section on property and equipment. What depreciation method does American Eagle use? What are the estimated useful lives for buildings and for fixtures and equipment?

2. Find note 7 for Property and Equipment. What are the cost and the book value of property and equipment? What is the trend in depreciation expense for the past three years?

3. Find note 8 for Intangible Assets. What intangible asset is listed? What are listed as the cost and the book value of intangible assets? What is the trend in amortization expense for the past three years?