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. Required a-1. Calculate the net income for Year 1. a-2. Which company will report the highest amount of net income for Year 1? b-1. Calculate the net income for Year 4. b-2. Which company will report the lowest amount of net income for Year 4? c-1. Calculate the book value on the December 31, Year 3, balance sheet. c-2. Which company will report the highest book value on the December 31, Year 3. balance sheet? 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? e. Which company will report the lowest amount of cash flow from operating activities on the Year 3 statement of cash flows? Complete this question by entering your answers in the tabs below. Required A Required B Required Required D Required E b-1. Calculate the net income for Year 4. (Round your "Per Unit Cost" to 3 decimal places.) b-2. Which company will report the lowest amount of net income for Year 4? Net Income 16-1 Company A Comnan R Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Required E b-1. Calculate the net income for Year 4. (Round your "Per Unit Cost" to 3 decimal places.) b-2. Which company will report the lowest amount of net income for Year 4? Net Income b-1 Company A Company B Company C Lowest net income 16-2 highest book value or the December 31, Year 3, balance sheet? 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. e. Which company will report the lowest amount of cash flow from operating activities on the Year 3 st Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Required E C-1. Calculate the book value on the December 31, Year 3, balance sheet. (Round "Per Unit Cost" to 3 de C-2. Which company will report the highest book value on the December 31, Year 3, balance sheet? Book Value C-1 Company A Company B Company C Highest book value |c-2 earnings on the December will report the lowest amount of cash flow from operating activities ont Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Required E C-1. Calculate the book value on the December 31, Year 3, balance sheet. (Round "Per Unit C-2. Which company will report the highest book value on the December 31, Year 3, balance Book Value C-1 Company A Company B Company C Highest book value C-2 d-2. Which company will report the highest amount of retaine e. Which company will report the lowest amount of cash flow Complete this question by entering your answers in the Required A Required B Required C Required D Requi d-1. Calculate the retained earnings on the December 31, Year d-2. Which company will report the highest amount of retained Retained Earnings d-1 Company A Company B Company C Highest retained earnings d-2
