(Learning Objectives 2, 4: Computing depreciation; recording a gain or loss on disposal)

On January 1, 20X6, Scoot Airline purchased an airplane for $37,700,000. Scoot Airline expects the plane to remain useful for six years and to have a residual value of $2,900,000.

Scoot Airline uses the straight-line method to depreciate its airplanes. Scoot Airline fl ew the plane for three years and sold it on January 1, 20X9, for $8,300,000.

1. Compute accumulated depreciation on the airplane at January 1, 20X9 (same as December 31, 20X8).

2. Record the sale of the plane on January 1, 20X9.