Under the answer section, may I know how did they derive the answer of " balancing, $1,345,000" at the "depreciation ($) column). Thank you!

Question:

Answer:

Question 2: Depreciation of Non-Current Assets (PPE) An airline company purchased and put into operation a new aircraft on 1 January 2008 at a cost of $7 million. The expectation was that the aircraft would be flown for 10,000 hours over a period of 4 years and then traded in for a newer model. The trade-in value was expected to be $1.5 million at the end of December 2011. The number of flying hours actually logged by the aircraft was as follows: Year ended 31 December 2008 31 December 2009 31 December 2010 31 December 2011 Flying hours 3,000 2,800 2,300 500 Page 1 of 2 The aircraft had a serious accident in January 2011 and was totally written off. The insurance settlement is expected to amount to $1,200,000. Required: Show the depreciation charges for each of the four financial years to 31st December 2011 using the following methods: (0) (ii) (iii) Straight line method Double-declining balance method On the basis of flying hours logged Depreciation per hour = (Cost - Residual Value) / Total hours = (7,000,000 1,500,000) / 10,000 hours = $550 Year ended 31 Dec 2008 2009 2010 2011 Total depreciation Flying hours 3,000 2,800 2,300 500 (n.a.) Depreciation ($) 550 X 3,000 = 1,650,000 550 X 2,800 = 1,540,000 550 X 2,300 = 1,265,000 [balancing] 1,345,000 5,800,000