Required information Problem 8-26A Determining the effect of depreciation expense on financial statements LO 8-2, 8-3, 8-4 [The following information applies to the questions displayed below.] Three different companies each purchased trucks on January 1, Year 1, for $78,000. Each truck was expected to last four years or 250,000 miles. Salvage value was estimated to be $5,000. All three trucks were driven 82,000 miles in Year 1, 52,000 miles in Year 2, 47,000 miles in Year 3, and 72,000 miles in Year 4. Each of the three companies earned $67,000 of cash revenue during each of the four Years. Company A uses straight-line depreciation, company B uses double-declining- balance depreciation, and company Cuses units-of-production depreciation. Answer each of the following questions. Ignore the effects of income taxes. Problem 8-26A Part d d-1. Calculate the retained earnings on the December 31, Year 4, balance sheet. d-2. Which company will report the highest amount of retained earnings on the December 31, Year 4, balance sheet? Complete this question by entering your answers in the tabs below. Required D1 Required D2 Calculate t Required D2 hings on the December 31, Year 4, balance sheet. Retained Earnings Company A Company B Company C Required information Problem 8-26A Determining the effect of depreciation expense on financial statements LO 8-2, 8-3, 8-4 [The following information applies to the questions displayed below.) Three different companies each purchased trucks on January 1, Year 1, for $78,000. Each truck was expected to last four Years or 250,000 miles. Salvage value was estimated to be $5,000. All three trucks were driven 82,000 miles in Year 1,52,000 miles in Year 2, 47,000 miles in Year 3, and 72,000 miles in Year 4. Each of the three companies earned $67,000 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. Problem 8-26A Part b -1. Calculate the net income for Year 4. -2. Which company will report the lowest amount of net income for Year 4? Complete this question by entering your answers in the tabs below. Required B1 Required B2 Calculate the net income for Year 4. (Round your "Per Unit Cost" to 3 decimal places.) Net Income Company A Company B Company C Required information Problem 8-26A Determining the effect of depreciation expense on financial statements LO 8-2, 8-3, 8-4 [The following information applies to the questions displayed below.) Three different companies each purchased trucks on January 1, Year 1, for $78,000. Each truck was expected to last four Years or 250,000 miles. Salvage value was estimated to be $5,000. All three trucks were driven 82,000 miles in Year 1, 52,000 miles in Year 2, 47,000 miles in Year 3, and 72,000 miles in Year 4. Each of the three companies earned $67,000 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. Problem 8-26A Part -1. Calculate the book value on the December 31, Year 3, balance sheet. -2. Which company will report the highest book value on the December 31, Year 3, balance sheet? Complete this question by entering your answers in the tabs below. Required C1 Required C2 Calculate the book value on the December 31, Year 3, balance sheet. (Round your "Per Unit Cost" to 3 decimal places.) Book Value Company A Company B Company C
