On January 1, 2020, AmerEx Transportation Company purchased a used aircraft at a cost of $51,000,000. AmerEx expects the plane to remain useful for five years (7,000,000 miles) and to have a residual value of $5,000,000. AmerEx expects to fly the plane 925,000 miles the first year, 1,250,000 miles each year during the second, third, and fourth years, and 2,325,000 miles the last year. Read the requirements. 1. Compute AmerEx's depreciation for the first two years on the plane using the straight-line method, the units-of-production method, and the double-declining balance method. a. Straight-line method Using the straight-line method, depreciation is b. Units-of-production method (Round the depreciation per unit of output to two decimal places to compute your final answers.) Using the units-of-production method, depreciation is c. Double-declining balance method Using the double-declining-balance method, depreciation is Book Value: Less: Book Value for 2020 and 2. Show the airplane's book value at the end of the first year under each method. Units-of- Production Straight-Line for 2020 and for 2020 and for 2021. C---- for 2021. Double-Declining- Balance for 2021. Requirements 1. Compute AmerEx's depreciation for the first two years on the plane using the following methods: a. Straight-line method b. Units-of-production method (round depreciation per mile to the closest cent) c. Double-declining-balance method 2. Show the airplane's book value at the end of the first year under each depreciation method. Print Done
On January 1, 2020, AmerEx Transportation Company purchased a used aircraft at a cost of $51,000,000. AmerEx expects the plane to remain useful for five years (7,000,000 miles) and to have a residual value of $5,000,000. AmerEx expects to fly the plane 925,000 miles the first year, 1,250,000 miles each year during the second, third, and fourth years, and 2,325,000 miles the last year. Read the requirements. 1. Compute AmerEx's depreciation for the first two years on the plane using the straight-line method, the units-of-production method, and the double-declining balance method. a. Straight-line method Using the straight-line method, depreciation is b. Units-of-production method (Round the depreciation per unit of output to two decimal places to compute your final answers.) Using the units-of-production method, depreciation is c. Double-declining balance method Using the double-declining-balance method, depreciation is Book Value: Less: Book Value for 2020 and 2. Show the airplane's book value at the end of the first year under each method. Units-of- Production Straight-Line for 2020 and for 2020 and for 2021. C---- for 2021. Double-Declining- Balance for 2021. Requirements 1. Compute AmerEx's depreciation for the first two years on the plane using the following methods: a. Straight-line method b. Units-of-production method (round depreciation per mile to the closest cent) c. Double-declining-balance method 2. Show the airplane's book value at the end of the first year under each depreciation method. Print Done
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter11: Depreciation, Depletion, Impairment, And Disposal
Section: Chapter Questions
Problem 10E: Hathaway Company purchased a copying machine for 8,700 on October 1, 2019. The machines residual...
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Transcribed Image Text:On January 1, 2020, AmerEx Transportation Company purchased a used aircraft at a cost of $51,000,000. AmerEx expects the plane to remain useful for five years (7,000,000 miles) and to have a residual value of $5,000,000.
AmerEx expects to fly the plane 925,000 miles the first year, 1,250,000 miles each year during the second, third, and fourth years, and 2,325,000 miles the last year.
Read the requirements.
1. Compute AmerEx's depreciation for the first two years on the plane using the straight-line method, the units-of-production method, and the double-declining balance method.
a. Straight-line method
Using the straight-line method, depreciation is
b. Units-of-production method (Round the depreciation per unit of output to two decimal places to compute your final answers.)
Using the units-of-production method, depreciation is
c. Double-declining balance method
Using the double-declining-balance method, depreciation is
Book Value:
Less:
Book Value
for 2020 and
2. Show the airplane's book value at the end of the first year under each method.
Units-of-
Production
Straight-Line
for 2020 and
for 2020 and
for 2021.
C----
for 2021.
Double-Declining-
Balance
for 2021.
Requirements
1. Compute AmerEx's depreciation for the first two years on the plane using the
following methods:
a. Straight-line method
b. Units-of-production method (round depreciation per mile to the
closest cent)
c. Double-declining-balance method
2. Show the airplane's book value at the end of the first year under each
depreciation method.
Print
Done
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