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Exercise 1 2 - 1 2 ( Algo ) Indirect: Preparing statement of cash flows LO P 2 , P 3 , A 1 Skip

Exercise 12-12(Algo) Indirect: Preparing statement of cash flows LO P2, P3, A1
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[The following information applies to the questions displayed below.]
The following financial statements and additional information are reported.
IKIBAN INCORPORATED
Comparative Balance Sheets
At June 3020212020
Assets
Cash $ 99,700 $ 57,000
Accounts receivable, net 84,50064,000
Inventory 76,800106,000
Prepaid expenses 5,7008,000
Total current assets 266,700235,000
Equipment 137,000128,000
Accumulated depreciationEquipment (33,500)(15,500)
Total assets $ 370,200 $ 347,500
Liabilities and Equity
Accounts payable $ 38,000 $ 49,500
Wages payable 7,30017,600
Income taxes payable 4,7006,400
Total current liabilities 50,00073,500
Notes payable (long term)43,00073,000
Total liabilities 93,000146,500
Equity
Common stock, $5 par value 246,000173,000
Retained earnings 31,20028,000
Total liabilities and equity $ 370,200 $ 347,500
IKIBAN INCORPORATED
Income Statement
For Year Ended June 30,2021
Sales $ 743,000
Cost of goods sold 424,000
Gross profit 319,000
Operating expenses (excluding depreciation)80,000
Depreciation expense 71,600
167,400
Other gains (losses)
Gain on sale of equipment 3,300
Income before taxes 170,700
Income taxes expense 45,190
Net income $ 125,510
Additional Information
A $30,000 notes payable is retired at its $30,000 carrying (book) value in exchange for cash.
The only changes affecting retained earnings are net income and cash dividends paid.
New equipment is acquired for $70,600 cash.
Received cash for the sale of equipment that had cost $61,600, yielding a $3,300 gain.
Prepaid Expenses and Wages Payable relate to Operating Expenses on the income statement.
All purchases and sales of inventory are on credit.
Exercise 12-12(Algo) Part 1
Required:
(1) Prepare a statement of cash flows using the indirect method for the year ended June 30,2021.
Note: Amounts to be deducted should be indicated with a minus sign.

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