On December 31, 2011, ExxonMobil, the large petroleum company, reported total assets of $331,052 million and annual net income of $41,060 million.
On the same date, Dayton Service Stations, Inc., operator of six gas stations in Dallas, reported total assets of $926,000 and annual net income of $224,000.
1. Suppose both companies made an investment of $250,000 in new equipment in January 2012. Would you expect the amount of detail about the investment that each company disclosed in its financial statements to differ? Why?
2. How would each company decide on its level of disclosure about the investment?