On January 1, 2015 Terry's Towing Service owned 10 tow trucks valued at $700 comma 000. During 2015 , Terry's bought 10 new trucks for a total of $750 comma 000. At the end of 2015 , the market value of all the firm's trucks was $1 comma 100 comma 000. What was Terry's gross investment? Calculate Terry's depreciation, and net investment.

The calculation of Terry's gross investment, depreciation, and net investment are as follows:

The depreciation is calculated as follows:

Terry's Depreciation = (700,000+750,000-1,100,000)

= $3,50,000

Total gross investment of Terry's towing service for both the years is

700,000+750,000 = $14,50,000

Net investment = Gross investment - depreciation

Gross investment = $750,000

Depreciation = $3,50,000

Therefore, net investment of Terry is = $4,00,000.