Assume that in January 20X6, a Hotcake House restaurant purchased a building, paying $57,000 cash and signing a $108,000 note payable. The restaurant paid another $60,000 to remodel the bu and fixtures cost $54,000, and dishes and supplies-a current asset-were obtained for $10,200. Hotcake House is depreciating the building over 20 years by the straight-line method, with estimat value of $55,000. The furniture and fixtures will be replaced at the end of five years and are being depreciated by the double-declining-balance method, with zero residual value. At the end of the firs restaurant still has dishes and supplies worth $1,900. Requirement 1. 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 1. 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 on Begin with the income statement. Income Statement Expenses
Assume that in January 20X6, a Hotcake House restaurant purchased a building, paying $57,000 cash and signing a $108,000 note payable. The restaurant paid another $60,000 to remodel the bu and fixtures cost $54,000, and dishes and supplies-a current asset-were obtained for $10,200. Hotcake House is depreciating the building over 20 years by the straight-line method, with estimat value of $55,000. The furniture and fixtures will be replaced at the end of five years and are being depreciated by the double-declining-balance method, with zero residual value. At the end of the firs restaurant still has dishes and supplies worth $1,900. Requirement 1. 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 1. 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 on Begin with the income statement. Income Statement Expenses
Chapter11: Long-term Assets
Section: Chapter Questions
Problem 15PB: Urquhart Global purchases a building to house its administrative offices for $500,000. The best...
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