Prairie Airlines purchased a 747 aircraft on January 1, 2020, at a cost of $ 30,000,000. The estimated useful life of the aircraft is 20 years, with an estimated residual value of $ 4,000,000. On January 1, 2022 the airline revises the total estimated useful life to 15 years with a revised residual value of $ 3,000,000.
Instructions
a) Calculate the depreciation and carrying amount at December 31, 2021 using the straight-line method and the double diminishing-balance method.
b) Assuming the straight-line method is used, calculate the depreciation expense for the year ended December 31, 2022.

Question

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The Answer of Prairie Airlines purchased a 747 aircraft on January 1, 2020, at a cost of $ 30,000,000. The estimated useful life of the aircraft is 20 years, with an estimated residual value of $ 4,000,000. On January 1, 2022 the airline revises the total estimated useful life to 15 years with a revised residual value of $ 3,000,000.
Instructions
a) Calculate the depreciation and carrying amount at December 31, 2021 using the straight-line method and the double diminishing-balance method.
b) Assuming the straight-line method is used, calculate the depreciation expense for the year ended December 31, 2022.

Prairie Airlines Purchased a 747 Aircraft on January 1, 2020