rotable parts

Assets2

1. 330-908Airlines330 Inventory

   ASC 330-908 governs inventory accounting for airlines, where "inventory" consists of expendable spare parts, materials, and supplies held for internal consumption rather than sale. Expendable parts are recorded at cost in a current asset account akin to a prepaid expense, carry an allowance for obsolescence tied to the lives of the related fleets, and are charged to expense as used.

2. 360-908Airlines360 Property, Plant, and Equipment

   ASC 360-908 governs property, plant, and equipment accounting unique to airlines: unit versus group depreciation, rotable parts, airframe modifications, and airframe/engine overhauls. Its core rules are that modifications enhancing an aircraft's usefulness must be capitalized and depreciated over the shorter of the aircraft's or the modification's useful life, and that overhauls must be accounted for under one of three permitted methods—direct expensing, built-in overhaul, or deferral—with the accrue-in-advance (accrual) method prohibited.