Delta Airlines

I would be wary of allowing Delta to make these changes. First because of the scene the industry faces (increasing price competition, new competitors, rising fuel prices, recession) and the resulting insistency to boost earnings. I would requisite to review in peak all the assumptions that Delta has used to raise the estimated useful life of its pip equipment by 25% in just 7 years I would also want to look at comparable airlines to confab how Deltas assumptions differ from American and United. For example, capital of Singapore Airlines in 1988 depreciated over 8 years with 10% residual value, while Delta in that same year depreciated its flight equipment over a 15 year period at 10% residual value. minded(p) that Singapore Airlines has an average age of aircraft 3.7 years younger than Delta and to a greater extent state of the art flight equipment, I would seriously head teacher the change. After this investigation, if I found that the assumptions were reasonable, I would then urge that Delta include a detailed explanation of its key assumptions whimsical the change in the footnotes section of its financial statements. Gains: Singapore Airlines has a different strategy from Delta.

Singapore Airlines is known for its high choice service, luxurious, state-of-the-art airlines and is geared largely to business travelers. The difference in depreciation assumptions could highlight the fact that it is replacing planes at a higher rate to maintain its brand image of lavishness and quality to continue to attract business travelers higher stipendiary travelers. (Singapore: $360 in tax revenue per passenger in 1993 vs. $141 in revenue per passenger for Delta). Calculation: Revs/revenue passenger miles * avg passenger mail length. Loses: If it increases the estimated useful life of its aircraft it could damage its core strategy. Therefore Singapores positioning might be undercutting its flexibility with prize to how much it can increase its depreciation assumptions as it relates to estimated... If you want to get a full essay, order it on our website: Ordercustompaper.com

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