Emerson Electric Co. (EMR)

Emerson records investments in land, buildings, and machinery and equipment at cost. Depreciation is computed principally using the straight-line method over estimated service lives, which for principal assets are 30 to 40 years for buildings and 8 to 12 years for machinery and equipment. Long-lived tangible assets are reviewed for impairment whenever events or changes in business circumstances indicate the carrying value of the assets may not be recoverable. Impairment losses are recognized based on estimated fair values if the sum of estimated future undiscounted cash flows of the related assets is less than the carrying values.

Source: Emerson Electric Co., Annual Report

Emerson Electric Co., Statement of Financial Position, Property, Plant and Equipment

USD $ in millions

Source: Based on data from Emerson Electric Co. 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.	Emerson Electric Co.'s land declined from 2015 to 2016 but then increased from 2016 to 2017 exceeding 2015 level.
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.	Emerson Electric Co.'s buildings declined from 2015 to 2016 but then slightly increased from 2016 to 2017.
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.	Emerson Electric Co.'s machinery and equipment declined from 2015 to 2016 but then slightly increased from 2016 to 2017.
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.	Emerson Electric Co.'s construction in progress declined from 2015 to 2016 but then slightly increased from 2016 to 2017.
Property, plant 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.	Emerson Electric Co.'s property, plant and equipment, at cost declined from 2015 to 2016 but then slightly increased from 2016 to 2017.
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.	Emerson Electric Co.'s property, plant and equipment, net declined from 2015 to 2016 but then increased from 2016 to 2017 not reaching 2015 level.

Emerson Electric Co., 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.	Emerson Electric Co.'s average age of depreciable property, plant and equipment deteriorated from 2015 to 2016 but then improved from 2016 to 2017 exceeding 2015 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.	Emerson Electric Co.'s estimated total useful life of depreciable property, plant and equipment increased from 2015 to 2016 and from 2016 to 2017.
Estimated time elapsed since purchase	The approximate age in years of a company's fixed assets. Useful for comparison purposes.	Emerson Electric Co.'s estimated time elapsed since purchase of depreciable property, plant and equipment deteriorated from 2015 to 2016 but then slightly improved from 2016 to 2017.
Estimated remaining life		Emerson Electric Co.'s estimated remaining life of depreciable property, plant and equipment increased from 2015 to 2016 and from 2016 to 2017.

2017 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.	Emerson Electric Co.'s average age of depreciable property, plant and equipment deteriorated from 2015 to 2016 but then improved from 2016 to 2017 exceeding 2015 level.

2017 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.	Emerson Electric Co.'s estimated total useful life of depreciable property, plant and equipment increased from 2015 to 2016 and from 2016 to 2017.

2017 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.	Emerson Electric Co.'s estimated time elapsed since purchase of depreciable property, plant and equipment deteriorated from 2015 to 2016 but then slightly improved from 2016 to 2017.

2017 Calculations

Ratio	Description	The company
Estimated remaining life		Emerson Electric Co.'s estimated remaining life of depreciable property, plant and equipment increased from 2015 to 2016 and from 2016 to 2017.