Apple, Inc. (AAPL), designs, manufactures, and markets personal computers (iPad™) and related software. Apple also manufactures and distributes music players (iPod™) along with related accessories and services, including the online distribution of third-party music.

The following information was adapted from a recent annual report of Apple:

a. Compute the book value of the fixed assets for Years 1 and 2 and explain the differences, if any.

b. Would you normally expect the book value of fixed assets to increase or decrease during the year?

Transcribed Image Text:

Property, Plant, and Equipment (in millions): Year 2 Year 1 Land and buildings $16,216 $ 13,587 Machinery, equipment, and internal-use software Leasehold improvements 65,982 54,210 8,205 7,279 Accumulated depreciation and amortization (49,099) (41,293)