Determining Cash Flows from Investing Activities}

Airco owns several aircraft and its statement of financial position indicated the following amounts for its aircraft accounts at the end of 2018 and 2017 :

\section*{Required:}
1. Assume that Airco did not sell any aircraft during 2018. Determine the amount of depreciation expense for 2018 and the cash spent for aircraft purchases in 2018.
2. If Airco sold for cash aircraft that cost \(\$ 4,100,000\) with accumulated depreciation of \(\$ 3,825,000\), producing a gain of \(\$ 193,000\), determine

(a) the amount of depreciation expense,

(b) the cash paid for aircraft purchases in 2018, and

(c) the cash inflow from the disposal of aircraft.
\section*{Exercise

Transcribed Image Text:

Equipment, aircraft Accumulated depreciation Book value 12/31/2018 $32,700,000 13,900,000 $18,800,000 12/31/2017 $22,250,000 13,125,000 $ 9.125.000