Daniel bought a brand-new truck for his landscaping business. He paid $30,000, the full amount upfront. Assuming there would be no salvage value, he planned to use it for 10 consecutive years. His assistant recorded this transaction on the balance sheet as equipment for $30,000 on the day of the purchase.

Aftertwoyears of owning his truck, Daniel decided to apply for a loan and met with Mr. Thompkins, the bank loan officer. A few minutes into the appointment, Daniel gave him his company's balance sheet. Mr. Thompkins asked Daniel several questions about how the information was provided. Daniel said he would get back to him in a few days with the requested information. The balance sheet showed the remaining value of the truck as $30,000 after two years.Daniel claimed that he was using GAAP.Help Daniel to answer the loan officer's questions. Provide your assistance inyour initial post:

• Which accounting method was used? Explain why you believe this method was used.
• Has his assistant recorded equipment correctly? Explain your answer.
• Please explain the GAAP principle that applies to this scenario.