Assume that in January X a Morning Cafe restaurant purchased a building, paying $ cash and signing a $ note payable. The restaurant paid another $ to remodel the
building. Furniture and fixtures cost $ and dishes and suppliesa current assetwere obtained for $ Morning Cafe is depreciating the building over years by the straightline
method, with estimated residual value of $ The furniture and fixtures will be replaced at the end of five years and are being depreciated by the doubledecliningbalance method, with zero
residual value. At the end of the first year, the restaurant still has dishes and supplies worth $
Requirement
Show what the restaurant will report for supplies, PPE, and cash flows at the end of the first year on its:
Income Statement
Balance Sheet
Statement of Cash Flows investing only
Note: The purchase of dishes and supplies is an operating cash flow because supplies are a current asset.
Requirement Show what the restaurant will report for supplies, PPE, and cash flows at the end of the first year on its Income Statement, Balance Sheet, and Statement of Cash Flows investing
only
Begin with the income statement.
Income Statement
Expenses:
