Chapter 10, Problem 1AA

To determine

Concept Introduction:

Straight line method of depreciation:

This is one of the methods to calculate the depreciation on assets. Under this method the depreciable value of asset it divided equally for each year f its estimated life. The formula to calculate the deprecation under straight line method is as follows:

  $AnnualStraightlinedepreciation=\frac{\left(Cost-SalvageValue\right)}{Estimatedlifeinyears}$

Requirement-1:

To Calculate:

The percentage of original cost of Apple's Property plant and equipment account remains to be depreciation as on Sept. 30, 2017 and as on Sept. 24, 2016

To determine

Concept Introduction:

Amortization of Intangible Assets:

Intangible assets are not physical assets which can be depreciated over its life. Hence to amortize the cost of the intangible asset, amortization expense is recorded in the books. The nature of the Amortization is same as of the depreciation. An intangible asset is amortized using the straight line method over its life.

Requirement-2:

To Identify:

If Apple capitalizes or expense the research and development cost

To determine

Concept Introduction:

Total Asset Turnover Ratio:

Asset Turnover Ratio is an efficiency ratio that represents the sales earned on the average assets invested in the business. It is calculated by dividing the Sales by Average total assets. The formulas to calculate the Asset Turnover Ratio is as follows:

  $AssetTurnoverRatio =\frac{Sales}{Averagetotalassets}$

Requirement-3:

To Calculate:

Total assets turnover for Apple for the year ended Sept. 30, 2017 and Sept. 24, 2016

To determine

Concept Introduction:

Total Asset Turnover Ratio:

Asset Turnover Ratio is an efficiency ratio that represents the sales earned on the average assets invested in the business. It is calculated by dividing the Sales by Average total assets. The formulas to calculate the Asset Turnover Ratio is as follows:

  $AssetTurnoverRatio =\frac{Sales}{Averagetotalassets}$

Requirement-4:

To Identify:

If the Total assets turnover for Apple for the year ended Sept. 30, 2017 and Sept. 24, 2016 is showing favorable or unfavorable trend