At the beginning of 2016, Advanced Airline purchased a used airplane at a cost of...
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At the beginning of 2016, Advanced Airline purchased a used airplane at a cost of $32,500,000. Advanced Airline expects the plane to remain useful for eight years (4,000,000 miles) and to have a residual value of $4,500,000. Advanced Airline expects the plane to be flown 1,500,000 miles the first year and 1,200,000 miles the second year. Requirements 1. Compute second-year (2017) depreciation expense on the plane using the following methods: a. Straight-line b. Units-of-production c. Double-declining-balance 2. Calculate the balance in Accumulated Depreciation at the end of the second year for all three methods. Requirement 2. Calculate the balance in Accumulated Depreciation at the end of the second year for all three methods. Straight-Line Units-of-production Double-declining-balance Depreciation Expense - 2016 Depreciation Expense - 2017 Accumulated Depreciation ending balance
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