Problem $6-24$A $($Static$)$ Determining the effect of depreciation expense on financial statements LO $6-2,6-3,6-4$

Three different companies each purchased trucks on January $1,$ Year $1,$ for $$50,000.$ Each truck was expected to last four years or $200,000$ miles. Salvage value was estimated to be $$5,000.$ All three trucks were driven $66,000$ miles in Year $1,42,000$ miles in Year $2,40,000$ miles in Year $3,$ and $60,000$ miles in Year $4.$ Each of the three companies earned $$40,000$ 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 bo ${?}^{\text{'}}.$ value on the December $31,$ Year $3,$ balance sheet?

d$-1.$ Calculate the retained earnings on the Defember $31,$ Year $4,$ balance sheet.

d$-2.$ Which company will report the highest aniount 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?