27 Required information Part 1 of 2 Exercise 12-12 (Algo) Indirect: Preparing statement of cash flows LO P2, P3, A1 [The following information applies to the questions displayed below.] 3.33 points The following financial statements and additional information are reported. eBook 2019 References IKIBAN INC. Comparative Balance Sheets At June 30 2020 Assets Cash $100, 300 Accounts receivable, net 83,000 Inventory 75,800 Prepaid expenses 5,600 Total current assets 264, 700 Equipment 136,000 Accum. depreciation-Equipment ( 33,000) Total assets $367, 700 Liabilities and Equity Accounts payable $ 37,000 Wages payable 7,200 Income taxes payable 4,600 Total current liabilities 48,800 Notes payable (long term) 42,000 Total liabilities 90,800 Equity Common stock, $5 par value 244,000 Retained earnings 32,900 $ 56,000 63,000 104,500 7,800 231,300 127,000 (15,000) $343,300 $ 48,000 17,400 6,200 71,600 72,000 143,600 172,000 27,700 27 Common stock, $5 par value Retained earnings Total liabilities and equity 244, VUU 32,900 $367, 700 1/2,000 27,700 $343, 300 Part 1 of 2 3.33 points IKIBAN INC. Income Statement For Year Ended June 30, 2020 Sales Cost of goods sold Gross profit Operating expenses (excluding depreciation) Depreciation expense $ 738,000 423,000 315,000 79,000 eBook 70,600 165,400 References Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income 3,200 168,600 45,090 $ 123,510 Additional Information a. A $30,000 note payable is retired at its $30,000 carrying (book) value in exchange for cash. b. The only changes affecting retained earnings are net income and cash dividends paid. c. New equipment is acquired for $69,600 cash. d. Received sale equipment that had cost $60,600, yielding a $3,200 gain. e. Prepaid Expenses and Wages Payable relate to Operating Expenses on the income statement. f. All purchases and sales of inventory are on credit. 27 Required information Required: (1) Prepare a statement of cash flows using the indirect method for the year ended June 30, 2020. (Amounts to be deducted should be indicated with a minus sign.) Part 1 of 2 3.33 points eBook IKIBAN, INC. Statement of Cash Flows (Indirect Method) For Year Ended June 30, 2019 Cash flows from operating activities Net income $ 123,510 Adjustments to reconcile net income to net cash provided by operating activities Income statement items not affecting cash Gain on sale of plant assets Depreciation expense 70,600 References (3,200) Changes in current operating assets and liabilities Increase in accounts receivable Decrease in inventory Decrease in prepaid expenses Decrease in accounts payable Decrease in wages payable Decrease in income taxes payable (20,000) 28,700 2,200 (11,000) (10,200) (1,600) UWCT HAS IT COURIS UZVU TILUUU11 27 Required information Part 1 of 2 $ 179,010 Cash flows from investing activities Cash received from sale of equipment Cash paid for equipment 3.33 points 0 eBook Cash flows from financing activities References $ 179,010 Net increase (decrease) in cash Cash balance at prior year-end Cash balance at current year-end $ 179,010