Question

Computing Asset Related Ratios Dick’s Sporting Goods included the following information in its year-end 2015 10-K....

Computing Asset Related Ratios

Dick’s Sporting Goods included the following information in its year-end 2015 10-K.

Sales............................................................. $7,270,965

PPE, gross ........................................................ 2,665,314

Land ............................................................. —

Construction in progress ............................................. 124,400

Accumulated depreciation ............................................ 1,317,429

PPE, net, at year-end 2014 ........................................... 1,203,382

Depreciation expense................................................ 193,594

Required

a. Compute PPE turnover.

b. Compute the average useful life.

c. Compute the percentage used up of the PPE.

Homework Answers

Answer #1

Calculation of PPE net

PPE Gross (A)

$2,665,314.00

Less: Accumulated depreciation (B)

($1,317,429.00)

PPE net (C=A+B)

$1,347,885.00

A

PPE Turnover = Turnover/PPE

Turonover (A)

$7,270,965

PPE Net (B)

$1,347,885

Turnover (A/B)

                    5.39

B

Average useful life = PPE Gross/Depreciation expenses

PPE Gross (A)

$2,665,314

Depreciation expenses (B)

$193,594

Average useful life (in Years) (C=A/B)

                 13.77

C

Percentage used up of PPE = Accumulated depreciation/PPE gross block

Accumulated depreciation (A)

$1,317,429.00

PPE Gross (B)

$2,665,314.00

Used % (A/B)

49.43%

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