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PLEASE ANSWER ALL MY QUESTIONS!

1. Timeton Inc. and Roseton Inc. purchase identical assets for $850,000 each. The assets of both the companies are estimated to have same life. However, Timeton estimates the residual value to be $6,000 and Roseton estimates the residual value to be $10,000. Both the companies use double-declining balance method of depreciation. Which of the following is true of these companies?

Group of answer choices

a. Net income of the first year of Timeton Inc. will be lesser than that of Roseton Inc.

b. Timeton and Roseton assets will have the same book value at the end of first year

c. Roseton will have higher taxable income than Timeton.

d. The book value of the asset of Timeton Inc. will be greater than Roseton Inc. at the end of first year

e. The depreciation expense of Timeton Inc. will be lesser than that of Roseton Inc.

2. Walters Enterprises decides to construct a warehouse on January 1, 2019. It borrows $590,000 at an annual interest rate of 7%. Walters completes the warehouse and begins using it on October 1, 2019. Compute the amount of interest Walters can capitalize to the warehouse account in 2019.

Group of answer choices

a. $0

b. $34,417

c. $41,300

d. $40,000

e. $30,975

3. Quinton Company owns a mine. During the year 20X2, 40,000 tons of ore was removed, leading to depletion of $380,000. Quintons accountant debited depletion expense for $380,000 and credited accumulated depletion. No ore was sold. Which of the following statements is true?

Group of answer choices

a. Quinton's assets are overstated.

b. Quinton's net income is overstated.

c. Quinton's assets are understated.

d. Quinton's assets are correctly stated.

e. Quinton's net income is correctly stated.

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