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which depreciation method results in higher depreciation expense when the asset is used more?both spam am airlines and twb airlines used straight-line depreciation for a $20 million jet. spam am used an estimated 35 year useful life and twb airlines used an estimated 25 year life for its planes but estimated similar residual values. as result of the differences in useful lives, which company will appear more profitable?

Respuesta :

Both spam am airlines and twb airlines used straight-line depreciation,  Spam Am airlines will appear more profitable.

What is straight-line depreciation?

With straight-line depreciation, an organization may spread the cost of a fixed asset over the time it will be used to generate value. A company's income statement, balance sheet, profitability, and net assets are all impacted by depreciation.

Straight line depreciation is calculated by multiplying the asset's cost by its estimated salvage value divided by the asset's anticipated useful life. Where: Cost of Asset is the sum of the asset's initial purchase price or construction costs and any associated capital outlays.

To learn more about depreciation

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