Intro Southwest Airlines just bought a new jet for $39,000,000. The jet falls into the 7-year...

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Intro Southwest Airlines just bought a new jet for $39,000,000. The jet falls into the 7-year...

Intro

Southwest Airlines just bought a new jet for $39,000,000. The jet falls into the 7-year MACRS category, with the following depreciation rates (half-year convention):

Year	1	2	3	4	5	6	7	8
Depr. rate	14.29%	24.49%	17.49%	12.49%	8.93%	8.92%	8.93%	4.46%

Part 1

What was the depreciation in year 5?

Depreciation = Initial book value * Depreciation rate
= 39,000,000 * 0.0893
= 3,482,700 Correct ✓

Part 2

What is the book value at the end of year 5?

business finance

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Answer 1

Answer #1

Depreciation in year 5 = $3,482,700 [ 39000000*0.0893] Book value at the end of year 5 = $11,487,450 39000000*(0.0892+0.0893+

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Answer 2

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Intro Southwest Airlines just bought a new jet for $39,000,000. The jet falls into the 7-year...

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