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. At June 30 Assets IKIBAN INCORPORATED Comparative Balance Sheets 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 Retained earnings Total liabilities and equity 2020 $ 99,100 86,000 77,800 5,800 2019 $ 58,000 65,000 107,500 8,200 268,700 138,000 (34,000) $ 372,700 $ 39,000 7,400 238,700 129,000 (16,000) $ 351,700 $ 51,000 17,800 4,800 6,600 51,200 75,400 44,000 74,000 95,200 149,400 248,000 174,000 29,500 28,300 $ 372,700 $ 351,700 IKIBAN INCORPORATED Income Statement For Year Ended June 30, 2020 $ 748,000 425,000 323,000 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 Additional Information 81,000 72,600 169,400 3,400 172,800 45,290 $ 127,510 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 $71,600 cash. d. Received cash for the sale of equipment that had cost $62,600, yielding a $3,400 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. 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 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 Cash paid for dividends Cash paid for equipment Cash paid for income taxes Cash paid for operating expenses Cash paid to retire notes Cash received from customers Decrease in accounts payable Decrease in accounts receivable Decrease in income taxes payable Decrease in inventory Decrease in prepaid expenses Decrease in wages payable Increase in accounts payable Increase in accounts receivable Increase in income taxes payable Increase in inventory Increase in prepaid expenses (2) Compute the company's cash flow on total assets ratio for its fiscal year 2020. Cash Flow on Total Assets Ratio Choose Numerator: I Choose Denominator: 1 = = Cash Flow on Total Assets Ratio Cash flow on total assets ratio 1 =