Required information Exercise 12-11 Indirect: Preparing 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, 2017 and 2016 2017 2016 $ 96,700 92,000 81,800 6,200 276,700 142,000 (36,000) $382,700 $ 62,000 69,000 113,500 9,000 253,500 133,000 (18,000) $368,500 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 $ 43,000 7,800 5,200 56,000 48,000 184,000 $ 57,000 18,600 7,400 83,000 78,000 161,000 256,000 22,700 $382,700 178,000 29,500 $368,500 IKIBAN INC. Tncome Statement Retained earnings Total liabilities and equity 22,700 $382,700 29,500 $368,500 IKIBAN INC. Income Statement For Year Ended June 30, 2017 Sales Cost of goods sold Gross profit Operating expenses Depreciation expense $76,600 Other expenses 85,000 Total operating expenses $768,000 429,000 339,000 161,600 177,400 Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income 3,800 181,200 45,690 $135,510 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 $75,600 cash. d. Received cash for the sale of equipment that had cost $66,600, yielding a $3,800 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. (1) Prepare a statement of cash flows for the year ended June 30, 2017, using the indirect method. (Amounts to be deducted shoul be indicated with a minus sign.) IKIBAN, INC. Statement of Cash Flows (Indirect Method) For Year Ended June 30, 2017 Cash flows from operating activities Net income Adjustments to reconcile net income to net cash provided by operating activities Income statement items not affecting cash Depreciation expense Gain on sale of plant assets Changes in current operating assets and liabilities Cash flows from investing activities Required information 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 (2) Compute the company's cash flow on total assets ratio for its fiscal year 2017. Choose Numerator: Cash Flow on Total Assets Ratio Choose Denominator: = Cash Flow on Total Assets Ratio = Cash flow on total assets ratio