Required information 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 Assets Cash Accounts receivable, net Prepaid expenses Inventory Total current assets Equipment Accumulated 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 2020 $ 93,100 101,000 87,800. 2019 $ 68,000 75,000 6,800 122,500 10,200 288,700 148,000 (39,000) $ 397,700 $ 49,000 8,400 275,700 139,000 (21,000) $ 393,700 $ 66,000 19,800 5,800 8,600 63,200 94,400 54,000 84,000 117,200 178,400 268,000 184,000 Retained earnings 12,500 31,300 Total liabilities and equity $ 397,700 $ 393,700 common stock, >> par value Retained earnings Total liabilities and equity 208,000 12,500 $ 397,700 IKIBAN INCORPORATED Income Statement 184,000 31,300 $ 393,700 Sales For Year Ended June 30, 2020 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 $ 798,000 435,000 363,000 91,000 82,600 189,400 4,400 193,800 46,290 $ 147,510 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 $81,600 cash. d. Received cash for the sale of equipment that had cost $72,600, yielding a $4,400 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. Exercise 12-12 (Algo) Part 1 quired. Exercise 12-12 (Algo) Part 1 Required: (1) Prepare a statement of cash flows using the indirect method for the year ended June 30, 2020. Note: Amounts to be deducted should be indicated with a minus sign. Cash flows from operating activities IKIBAN, INCORPORATED Statement of Cash Flows (Indirect Method) For Year Ended June 30, 2019 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 Required information Changes in current perduty abadia anu liau 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 Required information 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