The manager of ABC Company bought 50 trucks for the business use. When he recorded the trucks, he doubled the estimated life of the trucks. The second year he increased the residual value.

Requirements

1. Explain why he doubled the estimated life in the first year.

2. Explain why he increased the residual value.

3. Discuss the GAAP issues of each of the above

4. Discuss the ethical issue of each of the above