Assume that in early January 2012, an Early Bird Caf purchased a building, paying $54,000 cash and
Question:
Furniture and fixtures cost $51,000, and dishes and supplies—a current asset—were obtained for $9,000.
Early Bird Café is depreciating the building over 20 years by the straight-line method, with estimated residual value of $50,000. 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 first year, the restaurant still has dishes and supplies worth $1,300.
Show what the restaurant will report for supplies, plant assets, and cash flows at the end of the first year on its
Income statement,
Balance sheet, and
Statement of cash flows (investing only).
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Related Book For
Financial accounting
ISBN: 978-0132751124
9th edition
Authors: Walter T. Harrison Jr., Charles T. Horngren, C. William Thom
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