Flying High Air acquires a new aircraft.It has an estimated life of 10 years and should last for at least 20,000 hours of flight.What is the most appropriate method of depreciation to properly match revenues and expenses?

Question

Quizplus · Accepted Answer

The units-of-production method of depreciation is most appropriate in this scenario as it matches the depreciation charge with the actual usage of the aircraft. Since the useful life of the aircraft is estimated in hours of flight, this method would align the expense with the actual hours flown each year. This method is also preferred when the asset's usage is directly related to the generation of revenue.

Flying High Air Acquires a New Aircraft