Exercise 12-12 (Algo) 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 INCORPORATED Comparative Balance Sheets At June 30 2021 2020 Assets Cash $ 94,300 $ 66,000 Accounts receivable, net 98,000 73,000 Inventory 85,800 119,500 Prepaid expenses 6,600 9,800 Total current assets 284,700 268,300 Equipment 146,000 137,000 Accumulated depreciation-Equipment (38,000) (20,000) Total assets S 392,700 $385,300 Liabilities and Equity Accounts payable $ 47,000 $ 63,000 Wages payable 8,280 19,400 Income taxes payable 5,600 8,200 Total current liabilities 60,800 90,600 Notes payable (long tern) 52,000 82,000 Total liabilities 112,800 172,600 Equity Common stock, 55 par value 264,000 182,000 Retained earnings 15,900 30,700 Total liabilities and equity 5 392,780 $385,300 IKIBAN INCORPORATED Income Statement For Year Ended June 30, 2021 Sales Cost of goods sold Gross profit Operating expenses (excluding depreciation) Depreciation expense Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income $ 788,800 433,000 355,000 89,000 80,600 185,400 4.200 189,600 46,090 $ 143,510 Additional Information .. 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 $79,600 cash d. Received cash for the sale of equipment that had cost $70,600, yielding a $4,200 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. 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.) 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 net cash provided by operating activities Income statement items not affecting cash Changes in current operating assets and liabilities $ 0 Cash flows from investing activities 0 Cash flows from financing activities 0 $ 0 Net increase (decrease in cash Cash balance at nor year-end Cash balance at current year-end $ 0