Exercise 12-11 Indirect: Preparation of statement of cash flows LO P1, P2, P3, A1 The following information applies to the questions displayed below.] The following financial statements and additional information are reported. IKIBAN INC. Comparative Balance Sheets June 30, 2015 and 2014 2014 2015 Assets Cash $ 113,100 60,400 51,600 96,800 5,800 Accounts receivable, net Inventory Prepaid expenses 69,500 65,900 4,800 Total current assets 253,300 128,700 (28,200) 214,600 119,000 Equipment Accum. depreciation-Equipment (10,500) $353,800 323,100 Total assets Liabilities and Equity Accounts payable Wages payable Income taxes payable $ 26,000 32,800 7,700 2,400 7,000 3,900 36,100 Total current liabilities 53,700 80,000 Notes payable (long term) 60,000 96,100 Total liabilities 133,700 Equity Common stock, $5 par value Retained earnings 233,000 24,700 181,000 8,400 $353,800 323,100 Total liabilities and equity IKIBAN INC. Income Statement For Year Ended June 30, 2015 $676,000 409,000 Sales Cost of goods sold Gross profit Operating expenses Depreciation expense Other expenses 267,000 $58,200 66,400 Total operating expenses 124,600 142,400 Other gains (losses) Gain on sale of equipment 2,900 Income before taxes 145,300 58,120 Income taxes expense $ 87,180 Net income Additional Information a. A $20,000 note payable is retired at its $20,000 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 $58,700 cash d. Received cash for the sale of equipment that had cost $49,000, yielding a $2,900 gain e. Prepaid Expenses and Wages Payable relate to Other Expenses on the income statement. f. All purchases and sales of inventory are on credit Exercise 12-11 Part 1 Required (1) Prepare a statement of cash flows for the year ended June 30, 2015, using the indirect method (Amounts to be deducted should be indicated with a minus sign.) IKIBAN, INC Statement of Cash Flows (Indirect Method) For Year Ended June 30, 2015 Cash flows from operating activities Adjustments to reconcile net income to net cash provided by operating activities Income statement items not affecting cash Changes in current operating assets and liabilities Cash flows from investing activities 0 Cash flows from financing activities 0 Net increase (decrease) in cash 0 Cash balance at prior year-end 0 Cash balance at current year-end