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ABC Company has a truck with cost of $60,000 and accumulated depreciation of $38,000. Very similar...

  1. ABC Company has a truck with cost of $60,000 and accumulated depreciation of $38,000. Very similar trucks regularly sell at a local vehicle auction for $20,000. However, when ABC projects the future cash flows likely to be generated by the truck, those projected future cash flows have a net present value of only $16,000.

    What amount should ABC include in total assets for the truck?

    $16,000

    $38,000

    $20,000

    None of the other answer choices is correct.

    $0

    $22,000

    $60,000
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Answer #1

Answer : $22000

Amount should ABC include in total assets for the truck :

= Cost - Depreciation

= $60000 - $38000

= $22000

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