Reference no: EM131792304
Three different companies each purchased trucks on January 1, 2016, for $50,000. Each truck was expected to last four years or 200,000 miles. Salvage value was estimated to be $5,000. All three trucks were driven 66,000 miles in 2016, 42,000 miles in 2017, 40,000 miles in 2018, and 60,000 miles in 2019. Each of the three companies earned $40,000 of cash revenue during each of the four years. Company A uses straight-line depreciation, company B uses double-declining-balance depreciation, and company C uses units-of-production depreciation.
Answer each of the following questions. Ignore the effects of income taxes.
a-1. Calculate the net income for 2016? (Round your "Per Unit Cost" to 3 decimal places.)
a-2. Which company will report the highest amount of net income for 2016?
Company A
Company B
Company C
All of the above
b-1. Calculate the net income for 2019? (Round your "Per Unit Cost" to 3 decimal places.)
b-2. Which company will report the lowest amount of net income for 2019?
Company A
Company B
Company C
All of the above
c-1. Calculate the book value on the December 31, 2018, balance sheet? (Round your "Per Unit Cost" to 3 decimal places.)
c-2. Which company will report the highest book value on the December 31, 2018, balance sheet?
Company A
Company B
Company C
All of the above
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: Three different companies each purchased trucks on January 1, 2016, for $50,000. Each truck was expected to last four years or 200,000
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