Tasty Catering Purchased a Van on January 1,2015,for $48,000

question 181

Essay

Tasty Catering purchased a van on January 1,2015,for $48,000.The company decided to depreciate the van over a five-year period using the straight-line method.The company estimated its residual value at $3,000.Show how the costs should be presented on Tasty's balance sheet and income statement for the full year ended June 30,2017.Label the statements properly.

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Definitions:

Free Cash Flow

This represents the amount of cash a company generates from its operations after accounting for capital expenditures, showing the liquidity available for expansion, dividends, or debt repayment.

Capital Expenditures

Expenses incurred by a company to acquire or upgrade physical assets such as property, industrial buildings, or equipment, often to improve or maintain their long-term capacity and efficiency.

Net Cash

The amount of cash available after accounting for cash inflows minus cash outflows, reflecting a company's ability to meet its short-term obligations.

Operating Activities

Activities directly related to the principal revenue-generating activities of an organization.