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Author Topic: Why do my aircraft leases expense keep increasing even though . . .  (Read 2153 times)

Offline JJP

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 . . . I have not leased a new plane for WELL over 4 months?

I am losing money for the first time ever, and I tried to analyze the monthly income statement to figure out why.  The only significant change in cost has been for aircraft lease.  They went from $643K in FEB to $826K in MAR to $903K in MAY.  I thought leases were a constant expense (given that you don't lease more aircaft). 

What's going on here?

Thanks!

Offline swiftus27

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Re: Why do my aircraft leases expense keep increasing even though . . .
« Reply #1 on: August 11, 2009, 07:26:27 PM »
JJP, you paid for the first 4 months in advance.... IE before you got the plane.  Now you are paying the monthly payments on the lease.

DenisG

  • Former member
Re: Why do my aircraft leases expense keep increasing even though . . .
« Reply #2 on: August 11, 2009, 07:26:36 PM »
I am not sure when you bought them. But perhaps it is just the 'old surprise' that you pay the first 4 leases upfront and they are not cash effective during the first 4 months of operating this particular plane. After the first 4 months, the leases of that particular plane become cost effective in your income statement as a weekly expense. If you keep ordering new planes, at the beginning you make a profit easily, since the leases are not counted in yet. As those planes pass their first 4 months of operations, they start to cost the effective amount. When calculating direct profit on the airplane summary page, those leasing costs are stated, but not yet cost effective. The positive earnings presented there are Earnings after Direct Costs (EADC). The general costs still get deducted in the income statement. Perhaps, you continued to order planes and now those leasing rates kick in?

Denis

Offline JJP

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Re: Why do my aircraft leases expense keep increasing even though . . .
« Reply #3 on: August 11, 2009, 08:11:25 PM »
I know about the 4 month thing.  That's why I said, "I have not leased a new plane for WELL over 4 months."  That is to say: all planes I currently have, I have been paying leases on them for some time.  That's why I don't understand why the expense has gone up.

Offline swiftus27

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Re: Why do my aircraft leases expense keep increasing even though . . .
« Reply #4 on: August 11, 2009, 08:34:18 PM »
Ok JJP..

You said that you haven't LEASED a plane for over 4 months... You made no mention that it had been 4 months since the last one was delivered.   There is a difference.

Offline Sami

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    • AirwaySim - Are you the next Richard Branson?
Re: Why do my aircraft leases expense keep increasing even though . . .
« Reply #5 on: August 11, 2009, 08:37:27 PM »
Your lease costs have been completely steady over the last weeks. -263 613$ / week.

And you have gotten the first planes when game started, their leases started in start day + 4 months.
Then let's say after 3 weeks you got another plane .. it's leases start to go in game start day + 4 months + 3 weeks .. etc.


http://www.airwaysim.com/game/Office/Incomes?view=3&graph=AircraftLease

 

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