Question 2: (30 points) There are three companies (A, B, C), all of which started business on January 1, 2016. Each of them started the business by investing $100,000 in cash. Each bought in cash a piece of equipment worth $25,000 with a service life of 5 years and salvage value of $1,000 on January 2, 2016. The useful life of the equipment in units of production is 120,000 units. Estimated units of production for each year are as follows: Year 1 2 3 4 Number of Units 15,000 25,000 40,000 30,000 10,000 5 During the year, the three companies made all purchases and sales on credit. Each had selling expenses of $12,500 and administrative expenses of $500, which were paid in cash. The purchase prices and sales prices of merchandise were same for the three companies as follows: Date Units 15 Purchases Unit Cost ($) 1,000 Units Sales Unit Selling Price (5) 10 1,250 20 10 1.100 1,150 January 10, 2016 January 31, 2016 April 5, 2016 April 10, 2016 May 15, 2016 August 30, 2016 October 5, 2016 October 10, 2016 November 2, 2016 December 30, 2016 15 1,500 5 1.200 5 10 1,600 1,700 10 1,250 10 1,750 Company A uses Weighted Average Method for inventory valuation and Straight Line depreciation method. Company B uses FIFO for inventory valuation and Units of Production depreciation method. Company C uses LIFO for inventory valuation and Double Declining Balance depreciation method. Required: Prepare the Balance Sheet and the Income Statement for the year ending 2016 for each company