Problem:
All dollar amounts are in millions 2007 2006
Land..........................................................$ 764 $803
Buildings and land improvements..............$14,402 $13,719
Machinery, equipment and other................$45,303 $43,913
Construction in progress.............................$2,031 $2,224
Total land, plant, equipment.......................$62,500 $60,658
Accumulated depreciation............................(36,561) $34,983)
Net land, plant and equipment $25,939 $25,675
Statement of Cash Flows for 2007
Operating activities
Depreciation..............................................$3,474
Investing activities:
Capital expenditures................................ (5,971)
I am working with this problem and I need help with the following:
1) Estimate the book value of property and equipment disposed of during 2007.
2) Assume that a half-year's depreciation is taken on all assets acquired and disposed of during the year. Estimate the average depreciation life of Ford's property and equipment. Assume that none of the disposals was land, and eliminate the land balance when estimating the average depreciation life.
3) Estimate the average age of property and equipment (excluding land) owned by Ford as of Dec. 31, 2007.