On January 1, 2010, Red Airways Bought a Plane Costing

Multiple Choice

On January 1, 2010, Red Airways bought a plane costing $1,000,000. The plane has an estimated salvage value of $100,000 and an estimated useful life of 10 years. Red Airways uses the straight-line method of depreciation. The plane was estimated to have a fair market value of $950,000 at the end of 2010. How much depreciation expense should Red Airlines record on this plane on December 31, 2010?

A) $ 50,000
B) $ 90,000
C) $100,000
D) $900,000
E) none of the above