Property, Plant and Equipment Accounting Policy
Property on Operating Leases
Property on operating leases is reported at cost, less accumulated depreciation. Depreciation of the vehicles is generally provided on a straight-line basis to an estimated residual value over the lease term. The residual values of the vehicles related to the operating leases are estimated by using the estimate of future used vehicle values, taking into consideration data obtained from third parties.
Depreciation and Amortization
Depreciation of property, plant and equipment is calculated principally by the declining-balance method based on estimated useful lives and salvage values of the respective assets.
The estimated useful lives used in computing depreciation and amortization of property, plant and equipment are as follows:
|
Asset
|
|
|
Life |
|
|
Buildings |
|
|
3 to 50 years |
|
|
Machinery and equipment |
|
|
2 to 20 years |
|
Source: Honda Motor Co., Ltd., Annual Report
Property, Plant and Equipment Disclosure
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Honda Motor Co., Ltd., Statement of Financial Position, Property, Plant and Equipment
USD $ in millions, translated from JPY ￥
Source: Based on data from Honda Motor Co., Ltd. Annual Reports
| Item |
Description |
The company |
| Land |
Carrying amount as of the balance sheet date of real estate held for productive use. This excludes land held for sale. |
Honda Motor Co., Ltd.'s land increased from 2009 to 2010 and from 2010 to 2011.
|
| Buildings |
Carrying amount as of the balance sheet date of long-lived, depreciable assets that include building structures held for productive use including any addition, improvement, or renovation to the structure, such as interior masonry, interior flooring, electrical, and plumbing. |
Honda Motor Co., Ltd.'s buildings increased from 2009 to 2010 and from 2010 to 2011.
|
| Machinery and equipment |
Carrying amount as of the balance sheet date of long-lived, depreciable asset used in production process to produce goods and services. |
Honda Motor Co., Ltd.'s machinery and equipment increased from 2009 to 2010 and from 2010 to 2011.
|
| Construction in progress |
Carrying amount at the balance sheet date of long-lived asset under construction that include construction costs to date on capital projects that have not been completed and assets being constructed that are not ready to be placed into service. |
Honda Motor Co., Ltd.'s construction in progress increased from 2009 to 2010 and from 2010 to 2011.
|
| Property on operating leases, vehicles |
The amount of lessor property subject to or available for lease, at cost adjusted for any previously recognized impairment charges, by major property class, as of the balance sheet date. |
Honda Motor Co., Ltd.'s property on operating leases, vehicles increased from 2009 to 2010 and from 2010 to 2011.
|
| Property, plant and equipment, including property on operating leases, at cost |
Carrying amount at the balance sheet date for long-lived physical assets used in the normal conduct of business and not intended for resale. This can include land, physical structures, machinery, vehicles, furniture, computer equipment, construction in progress, and similar items. Amount does not include depreciation. |
Honda Motor Co., Ltd.'s property, plant and equipment, including property on operating leases, at cost increased from 2009 to 2010 and from 2010 to 2011.
|
| Net property, plant and equipment, including property on operating leases |
Tangible assets that are held by an entity for use in the production or supply of goods and services, for rental to others, or for administrative purposes and that are expected to provide economic benefit for more than one year; net of accumulated depreciation. Examples include land, buildings, and production equipment. |
Honda Motor Co., Ltd.'s net property, plant and equipment, including property on operating leases increased from 2009 to 2010 and from 2010 to 2011.
|
Property, Plant and Equipment Ratios (Summary)
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Honda Motor Co., Ltd., Property, Plant and Equipment Ratios
| Ratio |
Description |
The company |
| Average age |
As long as straight-line depreciation is used, this is an accurate estimate of asset age as a percentage of depreciable life. The relative age is a useful measure of whether the company's fixed asset base is old or new. Newer assets are likely to be more efficient. |
Honda Motor Co., Ltd.'s average age of depreciable property, plant and equipment deteriorated from 2009 to 2010 and from 2010 to 2011.
|
Average Age
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2011 Calculations
| Ratio |
Description |
The company |
| Average age |
As long as straight-line depreciation is used, this is an accurate estimate of asset age as a percentage of depreciable life. The relative age is a useful measure of whether the company's fixed asset base is old or new. Newer assets are likely to be more efficient. |
Honda Motor Co., Ltd.'s average age of depreciable property, plant and equipment deteriorated from 2009 to 2010 and from 2010 to 2011.
|
