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Suzie Sizemore owns Sizemore Aviation that operates in the Caribbean and parts of South America. She currently operates a Cessna Caravan, which she purchased five
Suzie Sizemore owns Sizemore Aviation that operates in the Caribbean and parts of South America. She currently operates a Cessna Caravan, which she purchased five years ago for $1,000,000 and which was being depreciated straight-line over 10 years, at the end of which it would have a zero salvage value. Right now, it has a market value of $625,000. She believes that if she updates to a Pilatus PC-12 turboprop that she can make her trips faster, carry more cargo and/or passengers and thus make more money. She has already prepared herself professionally and spent $25,000 to get training and certification on the Pilatus model last year. The downside is that the Pliatus sells for $3,000,000 and would only be economical to operate for 5 years, at which time it would have an estimated salvage value of $1,000,000. This plane would be depreciated straight-line over 5 years. Given the new plane's speed and efficiency, she believes that her revenue would increase by $400,000 per year and at the same time her expenses w
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