Property, Plant and Equipment Accounting Policy
Property and equipment is depreciated using the straight-line method over estimated useful lives or lease terms if shorter. Target amortizes leasehold improvements purchased after the beginning of the initial lease term over the shorter of the assets' useful lives or a term that includes the original lease term, plus any renewals that are reasonably assured at the date the leasehold improvements are acquired. Depreciation expense for 2011, 2010 and 2009 was $2,107 million, $2,060 million and $1,999 million, respectively. For income tax purposes, accelerated depreciation methods are generally used. Repair and maintenance costs are expensed as incurred and were $666 million in 2011, $726 million in 2010 and $632 million in 2009. Facility pre-opening costs, including supplies and payroll, are expensed as incurred.
| Estimated Useful Lives | Life (in years) |
|---|
| Buildings and improvements |
8-39 |
| Fixtures and equipment |
3-15 |
| Computer hardware and software |
4-7 |
Long-lived assets are reviewed for impairment when events or changes in circumstances indicate that the asset's carrying value may not be recoverable. Impairments of $38 million in 2011, $28 million in 2010 and $49 million in 2009 were recorded as a result of the reviews performed. Additionally, due to project scope changes, Target wrote off capitalized construction-in-progress costs of $5 million in 2011, $6 million in 2010 and $37 million in 2009.
Source: Target Corp., Annual Report
Property, Plant and Equipment Disclosure
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Target Corp., Statement of Financial Position, Property, Plant and Equipment
Source: Based on data from Target Corp. 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. |
Target Corp.'s land increased from 2010 to 2011 and from 2011 to 2012.
|
| 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. |
Target Corp.'s buildings and improvements increased from 2010 to 2011 and from 2011 to 2012.
|
| Fixtures and equipment |
Carrying amount at the balance sheet date for long-lived, depreciable asset commonly used in offices and stores. Examples include desks, chairs, and store fixtures. |
Target Corp.'s fixtures and equipment increased from 2010 to 2011 and from 2011 to 2012.
|
| 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. |
Target Corp.'s construction-in-progress increased from 2010 to 2011 and from 2011 to 2012.
|
| Property and equipment, gross |
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. |
Target Corp.'s property and equipment, gross increased from 2010 to 2011 and from 2011 to 2012.
|
| Property 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. |
Target Corp.'s property and equipment, net increased from 2010 to 2011 and from 2011 to 2012.
|
Property, Plant and Equipment Ratios (Summary)
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Target Corp., 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. |
Target Corp.'s average age of depreciable property, plant and equipment deteriorated from 2010 to 2011 but then improved from 2011 to 2012 exceeding 2010 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. |
Target Corp.'s estimated total useful life of depreciable property, plant and equipment increased from 2010 to 2011 and from 2011 to 2012.
|
| Estimated time elapsed since purchase |
The approximate age in years of a company's fixed assets. Useful for comparison purposes. |
Target Corp.'s estimated time elapsed since purchase of depreciable property, plant and equipment deteriorated from 2010 to 2011 and from 2011 to 2012.
|
| Estimated remaining life |
|
Target Corp.'s estimated remaining life of depreciable property, plant and equipment declined from 2010 to 2011 but then increased from 2011 to 2012 exceeding 2010 level.
|
Average Age
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2012 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. |
Target Corp.'s average age of depreciable property, plant and equipment deteriorated from 2010 to 2011 but then improved from 2011 to 2012 exceeding 2010 level.
|
Estimated Total Useful Life
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2012 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. |
Target Corp.'s estimated total useful life of depreciable property, plant and equipment increased from 2010 to 2011 and from 2011 to 2012.
|
Estimated Age, Time Elapsed Since Purchase
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2012 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. |
Target Corp.'s estimated time elapsed since purchase of depreciable property, plant and equipment deteriorated from 2010 to 2011 and from 2011 to 2012.
|
Estimated Remaining Life
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2012 Calculations
| Ratio |
Description |
The company |
| Estimated remaining life |
|
Target Corp.'s estimated remaining life of depreciable property, plant and equipment declined from 2010 to 2011 but then increased from 2011 to 2012 exceeding 2010 level.
|
