Exercise 12-11 Indirect: Preparing statement of cash flows LO 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, 2019 and 2018 2019 2018 $196,300 68,000 65,800 4,600 244,700 126,000 (28,000) $342,700 $ 46,000 53,000 89,500 5,800 194,300 117,000 (10,000) $301, 3ee Assets Cash Accounts receivable, net Inventory Prepaid expenses Total current assets Equipment Accum. depreciation-Equipment Total assets Liabilities and Equity Accounts payable Wages payable Income taxes payable Total current liabilities Notes payable (long term) Total liabilities Equity Common stock, $5 par value Retained earnings Total liabilities and equity $ 27,000 6,200 3,609 36,800 32,888 68,800 $ 33,000 15,400 4,200 52,600 62,eee 114,600 224, 49,900 $342,788 162,eee 24.700 $381,300 $688,888 413,000 275,800 IKIBAN INC. Income Statement For Year Ended June 30, 2019 Sales Cost of goods sold Gross profit Operating expenses Depreciation expense $60,689 Other expenses 69,000 Total operating expenses Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income 129,600 145,480 2,200 147,600 44,090 $103,510 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 $59,600 cash. d. Received cash for the sale of equipment that had cost $50,600. yielding a $2,200 gain c. Prepaid Expenses and Wages Payable relate to Other Expenses on the income statement 4. All purchases and sales of inventory are on credit. I Required information For Year Ended June 30, 2019 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 Cash flows from financing activities Changes in current operating assets and liabilities Cash flows from investing activities Cash flows from financing activities Net increase (decrease) in cash Cash balance at prior year-end Cash balance at current year-end