United Airline
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Posts: 8773
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Depreciation Rate Of Different Aircraft

Mon May 30, 2005 10:06 am

Can anyone tell me the depreciation rate of an A 319/320/321? Also a B 737NG? Thanks

I am working on a project at the moment and I need some help

Regards.
 
LAXintl
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RE: Depreciation Rate Of Different Aircraft

Mon May 30, 2005 10:22 am

What do you mean by depreciation rate?
Do you mean the way airlines account for them on the their books.. ie straightline, 15 year, 20 year etc.. or do you want to know what the book value of a particular aircraft is?
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United Airline
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RE: Depreciation Rate Of Different Aircraft

Mon May 30, 2005 10:27 am

Yeah something like that. Please advise. Thanks!
 
ikramerica
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RE: Depreciation Rate Of Different Aircraft

Mon May 30, 2005 10:34 am

So one from column A and one from column B?
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monteycarlos
Posts: 2018
Joined: Sun Mar 20, 2005 5:16 pm

RE: Depreciation Rate Of Different Aircraft

Mon May 30, 2005 10:45 am

Good morning United Airline!

I'll give you a couple of formulae to work with, because it sort of depends on a few things.

Flat rate depreciation, where Dpn = Annual rate of depreciation, C = cost of asset (list price if you will), R = residual value of the asset (i.e. scrap value) and N = useful economic life in years.

Gives the formula: Dpn = (C - R) / N

The other method (reducing balance) involves taking a certain set depreciation percentage and doing that over the written down value of the asset for each year... I suggest you see this website which gives a worked through example.

What you may need help with is finding residual values for A320 family aircraft and for B737NG family aircraft. For this, you may need to have a look at Flight International or another published press source... I'm not sure if you will get a reliable source of info for that here on a.net.  Wink

All the best!
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United Airline
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RE: Depreciation Rate Of Different Aircraft

Mon May 30, 2005 11:02 am

Thanks for the info. Anywhere I can actually find the rate?
 
monteycarlos
Posts: 2018
Joined: Sun Mar 20, 2005 5:16 pm

RE: Depreciation Rate Of Different Aircraft

Mon May 30, 2005 11:06 am

Quoting United Airline (Reply 5):
Anywhere I can actually find the rate?

Well it will differ for each case... In fact the residual values will differ on a case by case basis and so will the cost of the asset... You're best bet is to try and find an average using list prices and an average residual value. Sorry but I don't have that kind of information to give you.
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United Airline
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RE: Depreciation Rate Of Different Aircraft

Mon May 30, 2005 11:08 am

Thanks anyway! Stay in touch
 
Sydscott
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Joined: Thu Oct 30, 2003 11:50 am

RE: Depreciation Rate Of Different Aircraft

Mon May 30, 2005 3:54 pm

From the Australian Master Tax Guide 2005 edition -

Aeroplanes for general use - Effective life 20 years giving a prime cost rate of 5% and a dimishing value rate of 7.5%.

Do a depn rate search at www.ato.gov.au and you'll find masses of information to sift through.

This is the rate that Qantas and Virgin Blue use. We know this because they have been whinging that it's too long for a while now.

Hope this helps.