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Depreciation at Delta Air Lines & Singapore Air Lines

Answer 1 Delta Air Lines Depreciation for Delta prior to July 1 1986 Depreciation for Delta prior to April 1 1993 & after 1986 Depreciation for Delta after April 1 1993 Singapore Air Lines New Aircraft Less than 5 years Old Aircraft Depreciation for Singapore prior to 1990 Depreciation for Singapore after 1990 Old Aircraft More than 5 years Old Depreciation for Singapore prior to 1990 Depreciation for Singapore after 1990 Answer 3 Average cost of plane in 1993 Average cost of leased planes in 1993 Difference in the depreciation amount $9,043.00 Millions $173.00 Millions $115.20 Millions

$100*(100-10)%/10 = $100*(100-10)%/15 = $100*(100-5)%/20 =

$9.00 $6.00 $4.75

$100*(100-10)%/8= $100*(100-20)%/10=

$11.25 $8.00

$100*(100-10)%/8= $100*(100-20)%/10=

$11.25 $8.00

Difference in the depreciation amount using Sgp depreciation $299.52 Millions Answer 4 The basic strategy of the Two airlines is different. By the depreciation strategy Sgp arline reduces tax and sells aircraft at the end of 10yrs at much better rate than 20% of the residual value, making good profit and at the same time managing newer fleet. whereas the strategy of Delta is two use older aircraft & flying them at lesser expense.

Answer 5 No direct impact of the average age of the aircraft fleet.

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