If a company had a property, plant & equipment (PP&E) balance of $100m in the prior period and incurred $25m in capital expenditures and $5m in depreciation during the current period - what is the PP&E balance in the current period?

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Multiple Choice

If a company had a property, plant & equipment (PP&E) balance of $100m in the prior period and incurred $25m in capital expenditures and $5m in depreciation during the current period - what is the PP&E balance in the current period?

The ending PP&E balance is determined by taking the starting balance, adding new capital expenditures, and subtracting depreciation. Starting from 100 million, add 25 million of capex to reflect new investments, and subtract 5 million of depreciation to reflect asset aging. Net change is +25 − 5 = +20 million, so the ending PP&E is 100 + 20 = 120 million. This is the correct result because capex increases the asset base while depreciation reduces it, leaving the net PP&E balance at 120 million.

If a company had a property, plant & equipment (PP&E) balance of $100m in the prior period and incurred $25m in capital expenditures and $5m in depreciation during the current period - what is the PP&E balance in the current period?

Prepare for your Financial Statement Modeling Test. Utilize flashcards and multiple choice questions with detailed explanations. Ace your exam with thorough preparation!

If a company had a property, plant & equipment (PP&E) balance of $100m in the prior period and incurred $25m in capital expenditures and $5m in depreciation during the current period - what is the PP&E balance in the current period?

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