Depreciation and amortization are provided on a straight-line basis over the estimated useful lives of the assets. The following table shows estimated useful lives of property and equipment:
| Classification | Estimated Useful Lives |
|---|---|
| Buildings | 10 to 50 years (average 27 years) |
| Equipment | 3 to 20 years (average 11 years) |
Source: Abbott Laboratories, Annual Report
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Abbott Laboratories, Statement of Financial Position, Property, Plant and Equipment
USD $ in thousands
| Dec 31, 2011 | Dec 31, 2010 | Dec 31, 2009 | Dec 31, 2008 | Dec 31, 2007 | ||
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Buildings | |
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Construction in progress | |
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Property and equipment, at cost | |
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Accumulated depreciation and amortization | |
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Net property and equipment | |
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Source: Based on data from Abbott Laboratories 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. | Abbott Laboratories's land increased from 2009 to 2010 but then slightly declined 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. | Abbott Laboratories's buildings increased from 2009 to 2010 and from 2010 to 2011. |
| Equipment | Carrying amount as of the balance sheet date of long-lived, depreciable asset used in production process to produce goods and services. | Abbott Laboratories's 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. | Abbott Laboratories's construction in progress declined from 2009 to 2010 but then increased from 2010 to 2011 exceeding 2009 level. |
| Property and equipment, 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. | Abbott Laboratories's property and equipment, at cost increased from 2009 to 2010 and from 2010 to 2011. |
| Net property and equipment | 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. | Abbott Laboratories's net property and equipment increased from 2009 to 2010 but then slightly declined from 2010 to 2011. |
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Abbott Laboratories, Property, Plant and Equipment Ratios
| Dec 31, 2011 | Dec 31, 2010 | Dec 31, 2009 | Dec 31, 2008 | Dec 31, 2007 | ||
|---|---|---|---|---|---|---|
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Average age | % |
% |
% |
% |
% |
| 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. | Abbott Laboratories's average age of depreciable property, plant and equipment deteriorated from 2009 to 2010 and from 2010 to 2011. |
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| Dec 31, 2011 | Dec 31, 2010 | Dec 31, 2009 | Dec 31, 2008 | Dec 31, 2007 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (USD $ in thousands) | ||||||
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Accumulated depreciation and amortization | |
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Property and equipment, at cost | |
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Land | |
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| Ratio | ||||||
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Average age1 | % |
% |
% |
% |
% |
2011 Calculations
1 Average age = 100 × Accumulated depreciation and amortization ÷ (Property and equipment, at cost – Land)
= 100 × ÷ ( – ) = %
| 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. | Abbott Laboratories's average age of depreciable property, plant and equipment deteriorated from 2009 to 2010 and from 2010 to 2011. |
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