Question

A company has the following asset account balances: Buildings and equipment, $8,900,000; Accumulated depreciation, $1,800,000; Patents, $850,000; Land Improvements, $1,200,000; and Land, $5,000,000. How much will be reported on the balance sheet under property, plant, & equipment?

Answer 1

The total reported under Property, Plant, & Equipment on the balance sheet would be $13,300,000, which includes Buildings and Equipment, Land Improvements, and Land, after subtracting Accumulated Depreciation.

Step-by-step explanation:

The total amount to be reported on the balance sheet under Property, Plant, & Equipment (PP&E) for the company can be calculated by summing the balances of Buildings and Equipment, Land Improvements, and Land, and then subtracting the accumulated depreciation for the buildings and equipment. The patents would not be included in PP&E as they are intangible assets. The total PP&E will be the sum of $8,900,000 (Buildings and Equipment) plus $1,200,000 (Land Improvements) plus $5,000,000 (Land) minus $1,800,000 (Accumulated Depreciation), which equals $13,300,000.