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Case
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Reference no. 9-410-S16
Spanish language
Published by: Harvard Business Publishing
Originally published in: 2011
Version: 6 May 2009
Revision date: 10-May-2019
Length: 9 pages
Data source: Published sources

Abstract

This is a Spanish version. In estimating depreciation for accounting purposes, Delta Air Lines has changed its assumptions about aircraft lifespan and residual values four times in the last thirty years or so. In the most recent changes, Delta adopted fair value accounting as part of its 'fresh start' emergence from bankruptcy. Each of these policy changes has affected future asset values as well as present and future income. Students should organize their case analysis around three types of questions: (1) the estimated life cycle of commercial passenger airplanes; (2) the uses of financial reports, including the purpose of depreciation in reporting on assets and periodic income; and (3) alternative procedures for reporting asset book values and income that might better serve users of financial reports.
Location:
Industry:
Other setting(s):
2008

About

Abstract

This is a Spanish version. In estimating depreciation for accounting purposes, Delta Air Lines has changed its assumptions about aircraft lifespan and residual values four times in the last thirty years or so. In the most recent changes, Delta adopted fair value accounting as part of its 'fresh start' emergence from bankruptcy. Each of these policy changes has affected future asset values as well as present and future income. Students should organize their case analysis around three types of questions: (1) the estimated life cycle of commercial passenger airplanes; (2) the uses of financial reports, including the purpose of depreciation in reporting on assets and periodic income; and (3) alternative procedures for reporting asset book values and income that might better serve users of financial reports.

Settings

Location:
Industry:
Other setting(s):
2008

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