! 5 Required information [The following information applies to the questions displayed below.] The following financial statements and additional information are reported. Part 1 of 2 2020 IKIBAN INCORPORATED Comparative Balance Sheets At June 30 2021 Assets Cash $ 95,500 Accounts receivable, net 95,000 Inventory 83,800 Prepaid expenses 6,400 Total current assets 280, 700 Equipment 144,000 Accumulated depreciation-Equipment (37,000) Total assets $ 387,700 Liabilities and Equity Accounts payable $ 45,000 Wages payable 8,000 Income taxes payable 5,400 Total current liabilities 58,400 Notes payable (long term) 50,000 Total liabilities 108,400 Equity Common stock, $5 par value 260,000 Retained earnings 19,300 Total liabilities and equity $ 387, 700 $ 64,000 71,000 116,500 9,400 260,900 135,000 (19,000) $ 376,900 $ 60,000 19,000 7,800 86,800 80,000 166,800 180,000 30,100 $ 376,900 5 IKIBAN INCORPORATED Income Statement For Year Ended June 30, 2021 Sales Cost of goods sold Gross profit Operating expenses (excluding depreciation) Depreciation expense Part 1 of 2 $ 778,000 431,000 347,000 87,000 78,600 181,400 Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense 4,000 185,400 45,898 $ 139,510 Net Income Additional Information a. A $30,000 notes 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 $77,600 cash. d. Received cash for the sale of equipment that had cost $68,600, yielding a $4,000 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. 5 Required: (1) Prepare a statement of cash flows using the indirect method for the year ended June 30, 2021. (Amounts to be deducted should be indicated with a minus sign.) Part 1 of 2 IKIBAN INCORPORATED Statement of Cash Flows (Indirect Method) For Year Ended June 30, 2021 Cash flows from operating activities Adjustments to reconcile net income to not cash provided by operating activities Income statement items not affecting cash Changes in current operating assets and liabilities 0 Cash flows from investing activities Required information UT Part 1 of 2 Cash flows from investing activities Cash flows from financing activities 0 $ 0 Net increase (decrease) in cash Cash balance at prior year-end Cash balance at current year-end $ 0 6 For Year Ended June 30, 2821 Sales Cost of goods sold Gross profit Operating expenses (excluding depreciation) Depreciation expense $ 778,000 431,000 347,000 87,000 78,600 181,400 Part 2 of 2 Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net incone 4,000 185,400 45,899 $ 139,510 Additional Information a. A $30,000 notes 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 $77,600 cash. d. Received cash for the sale of equipment that had cost $68,600, yielding a $4,000 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. (2) Compute the company's cash flow on total assets ratio for its fiscal year 2021. Choose Numerator Cash Flow on Total Assets Ratio Choone Denominator Cash Flow on Total Assets Ratio Cash flow on total assets ratio
