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Essay text:
But the assumptions for salvage value and depreciation lives are different between Delta and Singapore airlines.
Companies prefer to depreciate aircraft using different salvage value and depreciation lives because of the managerial decision /policies about the recording the depreciation expense. SING prefers to record their depreciation expense in short period so that they can decrease their profit to pay less tax. While they have enough net profit, it is beneficiary for them to follow this policy.
While there are no fixed rules for the treatment, and it is decided by each company management, we can say that the treatment is proper as per their company policy...
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