On January 1, 2012, a Company Buys a Truck for $42,000

question 4

Essay

On January 1, 2012, a company buys a truck for $42,000 cash. It has estimated residual value of $2,000, and an estimated life of 4 years, or 200,000 miles. Assume the company uses units-of-production depreciation. The truck drove 40,000 miles in 2012, 60,000 miles in 2013, 80,000 miles in 2014, and 20,000 miles in 2015. Please complete the depreciation schedule below.

Identify the elements of financial statements and their measurements.

Comprehend and describe the conceptual framework underlying financial reporting.

Recognize how materiality and faithful representation impact financial reporting and decision making.

Distinguish between current and non-current classifications for assets and liabilities.