South airlines purchased a 747 aircraft on January 1,2017 at a cost of $35000000.the estimated useful life of the aircraft is 20 years,with an estimated salvage of $5000000.on January 1,2020 the airline revises the total estimated useful life to 15 years with a salvage value of $3500000 compute the depreciation and bok value at december 31,2019 using the straight line method and the double declining balance method accumulated depreciation straight line and declining balance ,and book value straight line and declining balance
Depreciation Methods
The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.
Depreciation Accounting
In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.
South airlines purchased a 747 aircraft on January 1,2017 at a cost of $35000000.the estimated useful life of the aircraft is 20 years,with an estimated salvage of $5000000.on January 1,2020 the airline revises the total estimated useful life to 15 years with a salvage value of $3500000 compute the
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