Where does Lila get the information on the useful life of Stan’s bake oven and the estimate for its residual value? Why do you think she gets the information from this particular source?
Lila got the information by going through the old worksheets filled by Stan. Lila insinuated this by asking Stan if he had started entering the worksheet into the Peachtree program. Lila asked Stan to join her in doing the adjustment on the worksheet so as to determine the actual shelf life of the Oven.
3. Why is a clear worksheet helpful even after the month’s statements have been prepared?
For proper records, the worksheet would make it easier to recall figures of past transactions. It is important to have a good record this might help in projecting future forecasts regarding profits and losses.
It would also be useful in determining the values of their various equipments, which obviously wear out over time.
