Property, Plant and Equipment Accounting Policy
Property, plant and equipment is recorded at historical cost. Depreciation and amortization are recognized on a straight-line basis over an asset’s estimated useful life. Land is not depreciated and construction in progress is not depreciated until ready for service.
Depreciable and amortizable assets are only evaluated for impairment upon a significant change in the operating or macroeconomic environment. In these circumstances, if an evaluation of the undiscounted cash flows indicates impairment, the asset is written down to its estimated fair value, which is based on discounted future cash flows. Useful lives are periodically evaluated to determine whether events or circumstances have occurred which indicate the need for revision.
Source: PepsiCo Inc., Annual Report
Property, Plant and Equipment Disclosure
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PepsiCo Inc., Statement of Financial Position, Property, Plant and Equipment
Source: Based on data from PepsiCo Inc. Annual Reports
| Item |
Description |
The company |
| Land and improvements |
Real estate assets held for productive use and depreciable assets that are an addition or improvement to real estate held for productive use. |
PepsiCo Inc.'s land and improvements increased from 2008 to 2009 and from 2009 to 2010.
|
| Buildings and improvements |
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. |
PepsiCo Inc.'s buildings and improvements increased from 2008 to 2009 and from 2009 to 2010.
|
| Machinery and equipment, including fleet and software |
Carrying amount as of the balance sheet date of long-lived, depreciable asset used in production process to produce goods and services. |
PepsiCo Inc.'s machinery and equipment, including fleet and software increased from 2008 to 2009 and from 2009 to 2010.
|
| 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. |
PepsiCo Inc.'s construction in progress declined from 2008 to 2009 but then increased from 2009 to 2010 exceeding 2008 level.
|
| Gross property, plant and equipment |
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. |
PepsiCo Inc.'s gross property, plant and equipment increased from 2008 to 2009 and from 2009 to 2010.
|
| Property, plant and equipment, net |
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. |
PepsiCo Inc.'s property, plant and equipment, net increased from 2008 to 2009 and from 2009 to 2010.
|
Property, Plant and Equipment Ratios (Summary)
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PepsiCo Inc., 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. |
PepsiCo Inc.'s average age of depreciable property, plant and equipment deteriorated from 2008 to 2009 but then improved from 2009 to 2010 exceeding 2008 level.
|
| Estimated total useful life |
Over longer time periods, this ratio is a useful measure of company's depreciation policy and can be used for comparisons with competitors. |
PepsiCo Inc.'s estimated total useful life of depreciable property, plant and equipment increased from 2008 to 2009 but then declined significantly from 2009 to 2010.
|
| Estimated time elapsed since purchase |
The approximate age in years of a company's fixed assets. Useful for comparison purposes. |
PepsiCo Inc.'s estimated time elapsed since purchase of depreciable property, plant and equipment deteriorated from 2008 to 2009 but then improved from 2009 to 2010 exceeding 2008 level.
|
| Estimated remaining life |
|
PepsiCo Inc.'s estimated remaining life of depreciable property, plant and equipment increased from 2008 to 2009 and from 2009 to 2010.
|
Average Age
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2010 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. |
PepsiCo Inc.'s average age of depreciable property, plant and equipment deteriorated from 2008 to 2009 but then improved from 2009 to 2010 exceeding 2008 level.
|
Estimated Total Useful Life
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2010 Calculations
| Ratio |
Description |
The company |
| Estimated total useful life |
Over longer time periods, this ratio is a useful measure of company's depreciation policy and can be used for comparisons with competitors. |
PepsiCo Inc.'s estimated total useful life of depreciable property, plant and equipment increased from 2008 to 2009 but then declined significantly from 2009 to 2010.
|
Estimated Age, Time Elapsed Since Purchase
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2010 Calculations
| Ratio |
Description |
The company |
| Estimated time elapsed since purchase |
The approximate age in years of a company's fixed assets. Useful for comparison purposes. |
PepsiCo Inc.'s estimated time elapsed since purchase of depreciable property, plant and equipment deteriorated from 2008 to 2009 but then improved from 2009 to 2010 exceeding 2008 level.
|
Estimated Remaining Life
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2010 Calculations
| Ratio |
Description |
The company |
| Estimated remaining life |
|
PepsiCo Inc.'s estimated remaining life of depreciable property, plant and equipment increased from 2008 to 2009 and from 2009 to 2010.
|
