Homework Answers
| 1) | Straight line depreciation | |||||||
| (Cost - salvage value)/estimated useful life | ||||||||
| (50,700,000-4,700,000)/5 | ||||||||
| 9200000 | ||||||||
| Depreciation expense | ||||||||
| 2017 | 9200000 | |||||||
| 2018 | 9200000 | |||||||
| 2) | units of production method | |||||||
| (50,700,000-4,700,000)/6,000,000 | ||||||||
| 7.666667 | per mile | |||||||
| depreciation expense = dep rate per mile (7.666667)*miles per year | ||||||||
| Depreciation expense | ||||||||
| 2017 | 5558333 | |||||||
| 2018 | 10350000 | |||||||
| 3) | Double declining balance method | |||||||
| (1/5*2) | ||||||||
| 40% | ||||||||
| Depreciation expense | ||||||||
| 2017 | 20280000 | (50,700,000*40%) | ||||||
| 2018 | 12168000 | (50,700,000-20,280,000)*40% | ||||||
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i Requirements 1. Compute Best Shipping's depreciation for the first two years on the plane using...
On January 1, 2017, Best Shipping Transportation Company purchased a used aircraft at a cost of...
On January 1, 2017, Best Shipping Transportation Company purchased a used aircraft at a cost of $46,300,000. Best Shippin Best Shipping expects to fly the plane 835,000 miles the first year, 1,225,000 miles each year during the second, third, and fou Read the requirements. 1. Compute Best Shipping's depreciation for the first two years on the plane using the straight-line method, the units-of-produa a. Straight-line method Using the straight-line method, depreciation is $ for 2017 and $ for 2018 b....
On January 1, 2017, Best Shipping Transportation Company purchased a used aircraft at a cost of...
On January 1, 2017, Best Shipping Transportation Company purchased a used aircraft at a cost of $46,700,000. Best Shipping expects the plane to remain useful for five years (6,800,000 miles) and to have a residual value of $4,700,000. Best Shipping expects to fly the plane 700,000 miles the first year, 1,650,000 miles each year during the second, third, and fourth years, and 1,150,000 miles the last year. Read the requirements. 1. Compute Best Shipping's depreciation for the first two years...
On January 1, 2017, Quick Travel Transportation Company purchased a used aircraft at a cost of...
On January 1, 2017, Quick Travel Transportation Company purchased a used aircraft at a cost of $63,200,000. Quick Travel expects the plane to remain useful for five years (7,000,000 miles) and to have a residual value of $5,200,000. Quick Travel expects to fly the plane 850,000 miles the first year, 1,325,000 miles each year during the second, third, and fourth years, and 2,175,000 miles the last year. Read the requirements. 1. Compute Quick Travel's depreciation for the first two years...
Requirements e1. Compute Austin Airlines's first-year depreciation expense on the plane using the following methods: a....
Requirements e1. Compute Austin Airlines's first-year depreciation expense on the plane using the following methods: a. Straight-line b. Units-of-production c. Double-declining-balance 2. Show the airplane's book value at the end of the first year for all three methods. ir Print Done a on the nlens using the double-declinina-halance meth town 1,800.000 miesthe first yea tems with a zero value
On January 1, 2017, QuickAir Transportation Company purchased a used aircraft at a cost of $63,100,000....
On January 1, 2017, QuickAir Transportation Company purchased a used aircraft at a cost of $63,100,000. QuickAir expects the plane to remain useful for five years (7,000,000 miles) and to have a residual value of $5,100,000. QuickAir expects to fly the plane 800,000 miles the first year, 1,350,000 miles each year during the second, third, and fourth years, and 2,150,000 miles the last year. Read the requirements a. Straight-line method for 2017 and $ Using the straight-line method, depreciation is...
S7-5 (similar to) :3 Question Help On January 1, 2017, Alaska Freight Transportation Company purchased a...
S7-5 (similar to) :3 Question Help On January 1, 2017, Alaska Freight Transportation Company purchased a used aircraft at a cost of $64,400,000. Alaska Freight expects the plane to remain useful for five years (6,500,000 miles) and to have a residual value of $6,400,000. Alaska Freight expects to fly the plane 835,000 miles the first year, 1,275,000 miles each year during the second, third, and fourth years, and 1,840,000 miles the last year. Read the requirements. 1. Compute Alaska Freight's...
On January 1, 2017, Timely Delivery Transportation Company purchased a used aircraft at a cost of...
On January 1, 2017, Timely Delivery Transportation Company purchased a used aircraft at a cost of $63,400,000. Timely Delivery expects the plane to remain useful for five years (6,800,000 miles) and to have a residual value of $5,400,000. Timely Delivery expects to fly the plane 700,000 miles the first year, 1,300,000 miles each year during the second, third, and fourth years, and 2,200,000 miles the last year. Read the requirements. 1. Compute Timely Delivery's depreciation for the first two years...
i Requirements Assume Logan Service is trying to decide which depreciation method to use for income...
i Requirements Assume Logan Service is trying to decide which depreciation method to use for income tax purposes. The company can choose from among the following methods: (a) straight-line, (b) units-of-production, or (c) double-declining-balance methods. 1. Which depreciation method offers the highest tax advantage for the first year? Describe the nature of the tax advantage. 2. How much income tax will Logan Service save for the first year of the airplane's use under the method you just selected as compared...
On January 1, 2018, Austin Airlines purchased a used airplane for $50,000,000. Austin Airlines expects the...
On January 1, 2018, Austin Airlines purchased a used airplane for $50,000,000. Austin Airlines expects the plane to remain useful for four years (4,000,000 miles) and to have a residual value of $6,000,000. The company expects the plane to be flown 1,500,000 miles the first year. Read the requirements. Requirement 1a. Compute Austin Airlines's first-year depreciation expense on the plane using the straight-line method. Begin by selecting the formula to calculate the company's first-year depreciation expense on the plane using...
On January 1, 2018, Northeast Airlines purchased a used airplane for $37,500,000. Northeast Airlines expects the...
On January 1, 2018, Northeast Airlines purchased a used airplane for $37,500,000. Northeast Airlines expects the plane to remain useful for four years (4,000,000 miles) and to have a residual value of $5,500,000. The company expects the plane to be flown 1,300,000 miles the first year. Read the requirements. Requirement 1a. Compute Northeast Airlines's first-year depreciation expense on the plane using the straight-line method. Begin by selecting the formula to calculate the company's first-year depreciation expense on the plane using...
On January 1, 2017, Best Shipping Transportation Company purchased a used aircraft at a cost of $46,300,000. Best Shippin Best Shipping expects to fly the plane 835,000 miles the first year, 1,225,000 miles each year during the second, third, and fou Read the requirements. 1. Compute Best Shipping's depreciation for the first two years on the plane using the straight-line method, the units-of-produa a. Straight-line method Using the straight-line method, depreciation is $ for 2017 and $ for 2018 b....
On January 1, 2017, Best Shipping Transportation Company purchased a used aircraft at a cost of $46,700,000. Best Shipping expects the plane to remain useful for five years (6,800,000 miles) and to have a residual value of $4,700,000. Best Shipping expects to fly the plane 700,000 miles the first year, 1,650,000 miles each year during the second, third, and fourth years, and 1,150,000 miles the last year. Read the requirements. 1. Compute Best Shipping's depreciation for the first two years...
On January 1, 2017, Quick Travel Transportation Company purchased a used aircraft at a cost of $63,200,000. Quick Travel expects the plane to remain useful for five years (7,000,000 miles) and to have a residual value of $5,200,000. Quick Travel expects to fly the plane 850,000 miles the first year, 1,325,000 miles each year during the second, third, and fourth years, and 2,175,000 miles the last year. Read the requirements. 1. Compute Quick Travel's depreciation for the first two years...
Requirements e1. Compute Austin Airlines's first-year depreciation expense on the plane using the following methods: a. Straight-line b. Units-of-production c. Double-declining-balance 2. Show the airplane's book value at the end of the first year for all three methods. ir Print Done a on the nlens using the double-declinina-halance meth town 1,800.000 miesthe first yea tems with a zero value
On January 1, 2017, QuickAir Transportation Company purchased a used aircraft at a cost of $63,100,000. QuickAir expects the plane to remain useful for five years (7,000,000 miles) and to have a residual value of $5,100,000. QuickAir expects to fly the plane 800,000 miles the first year, 1,350,000 miles each year during the second, third, and fourth years, and 2,150,000 miles the last year. Read the requirements a. Straight-line method for 2017 and $ Using the straight-line method, depreciation is...
S7-5 (similar to) :3 Question Help On January 1, 2017, Alaska Freight Transportation Company purchased a used aircraft at a cost of $64,400,000. Alaska Freight expects the plane to remain useful for five years (6,500,000 miles) and to have a residual value of $6,400,000. Alaska Freight expects to fly the plane 835,000 miles the first year, 1,275,000 miles each year during the second, third, and fourth years, and 1,840,000 miles the last year. Read the requirements. 1. Compute Alaska Freight's...
On January 1, 2017, Timely Delivery Transportation Company purchased a used aircraft at a cost of $63,400,000. Timely Delivery expects the plane to remain useful for five years (6,800,000 miles) and to have a residual value of $5,400,000. Timely Delivery expects to fly the plane 700,000 miles the first year, 1,300,000 miles each year during the second, third, and fourth years, and 2,200,000 miles the last year. Read the requirements. 1. Compute Timely Delivery's depreciation for the first two years...
i Requirements Assume Logan Service is trying to decide which depreciation method to use for income tax purposes. The company can choose from among the following methods: (a) straight-line, (b) units-of-production, or (c) double-declining-balance methods. 1. Which depreciation method offers the highest tax advantage for the first year? Describe the nature of the tax advantage. 2. How much income tax will Logan Service save for the first year of the airplane's use under the method you just selected as compared...
On January 1, 2018, Austin Airlines purchased a used airplane for $50,000,000. Austin Airlines expects the plane to remain useful for four years (4,000,000 miles) and to have a residual value of $6,000,000. The company expects the plane to be flown 1,500,000 miles the first year. Read the requirements. Requirement 1a. Compute Austin Airlines's first-year depreciation expense on the plane using the straight-line method. Begin by selecting the formula to calculate the company's first-year depreciation expense on the plane using...
On January 1, 2018, Northeast Airlines purchased a used airplane for $37,500,000. Northeast Airlines expects the plane to remain useful for four years (4,000,000 miles) and to have a residual value of $5,500,000. The company expects the plane to be flown 1,300,000 miles the first year. Read the requirements. Requirement 1a. Compute Northeast Airlines's first-year depreciation expense on the plane using the straight-line method. Begin by selecting the formula to calculate the company's first-year depreciation expense on the plane using...
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