Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Can someone please help with this question? If so, can you show exactly how to do it, not just the answer. Thank you! On January
Can someone please help with this question? If so, can you show exactly how to do it, not just the answer. Thank you!
On January 1, 2018, Northeast USA purchased a used airplane at a cost of $35,200,000. Northeast USA expects the plane to remain useful for eight years (5,000,000 miles) and to have a residual value of $5,200,000. Northeast USA expects the plane to be flown 1,400,000 miles the first year and 1,500,000 miles the second year. Read the requirements Requirement 1a. Compute second-year (2019) depreciation expense on the plane using the straight-line method. Begin by selecting the formula to calculate the company's second-year depreciation expense on the plane using the straight-line method. Then enter the amounts and calculate the depreciation expense for the second year. Cost Residual value )4 Useful life = Straight-line depreciation ( $ 35,200,000 5,200,000 8 3,750,000 Requirement 1b. Compute second-year (2019) depreciation expense on the plane using the units-of-production method. Before calculating the second-year depreciation expense on the plane using the units-of-production method, calculate the depreciation expense per unit. Select the formula, then enter the amounts and calculate the depreciation expense per unit. Cost Residual value ) Useful life in units Depreciation per unit 35,200,000 $ 5,200,000 5,000,000 6 Now, select the formula, enter the amounts and calculate the company's second-year depreciation expense on the plane using the units-of-production method. Depreciation per unit Current year usage Units-of-production depreciation $ 1,500,000 9,000,000 Requirement 1c. Compute second-year (2019) depreciation expense on the plane using the double-declining-balance method. Begin by selecting the formula to calculate the company's second-year depreciation expense on the plane using the double-declining-balance method. Then enter the amounts and calculate the depreciation expense for the second year. Cost ) x Accumulated depreciation 8,800,000 2 x (1 / Useful life) 2 x (1/8) Double-declining- balance depreciation 6,600,000 ($ 35,200,000 ) x Requirement 2. Calculate the balance in Accumulated Depreciation at the end of the second year for all three methods Depreciation Expense - 2018 $ Straight-Line 3,750,000 $ 3,750,000 7,500,000 $ Units-of-production Double-declining-balance 8,400,000 $ 8,800,000 9,000,000 6,600,000 Depreciation Expense - 2019 $ 17,400,000 $ 15,400,000 Accumulated Depreciation ending balanceStep by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started