Delta Air Lines owns hundreds of aircraft, with about 60 percent of its fleet consisting of Boeing aircraft, while Airbus aircraft make up about 40 percent. It sold seven used Boeing 767-300 jets to Amazon.com as Amazon plans to expand its growing Amazon Air cargo service. The average age of the jets is about 20 years old. Assume the records of the company reflected the following for the jets that were sold:

Required:
1. Give the journal entry for the disposal of the airplanes, assuming that the airplanes sold for
a. $15,700,000 cash
b. $16,300,000 cash
c. $14,600,000 cash
2. Based on the three preceding situations, explain the effects of the disposal of an asset.

Transcribed Image Text:

Aircraft cost Accumulated depreciation $62,500,000 46,800,000