Question
Gandolfi Construction Company purchased a CAT 336DL earth mover at a cost of $455,000 in January 2022. The companys estimated useful life of this heavy
Gandolfi Construction Company purchased a CAT 336DL earth mover at a cost of $455,000 in January 2022. The companys estimated useful life of this heavy equipment is 10 years, and the estimated salvage value is $88,000. Assume that Gandolfi Construction Company calculated depreciation expense for the CAT 336DL earth mover on the straight-line method and reported $525,600 of net income for the year ended December 31, 2022. The companys average total assets for 2022 were $3,650,000. Required: Calculate Gandolfis ROI for the year ended December 31, 2022. Calculate what Gandolfis ROI would have been for the year ended December 31, 2022, had the company used the double-declining-balance depreciation method for the CAT 336DL earth mover. Ignore the effects of income taxes.
Calculate Gandolfi's ROI for the year ended December 31, 2022. Calculate what Gandolfi's ROI would have been for the year ended December 31, 2022, had the company used the doubledeclining-balance depreciation method for the CAT 336DL earth mover. Ignore the effects of income taxesStep by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started