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 2020 2019 Assets Cash Accounts receivable, net Prepaid expenses $ 93,700 99,500 $ 67,000 74,000 Inventory Total current assets Equipment Accumulated depreciation-Equipment Total assets Liabilities and Equity 86,800 6,700 121,000 10,000 286,700 272,000 Accounts payable Wages payable Income taxes payable Total current liabilities 147,000 (38,500) $ 395,200 $ 48,000 8,300 138,000 (20,500) $ 389,500 $ 64,500 19,600 8,400 92,500 Notes payable (long term) Total liabilities Equity Common stock, $5 par value Retained earnings Total liabilities and equity IKIBAN INCORPORATED 5,700 62,000 53,000 83,000 115,000 175,500 266,000 14,200 183,000 31,000 $ 395,200 $ 389,500 Income Statement For Year Ended June 30, 2020 $ 793,000 434,000 359,000 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 90,000 81,600 187,400 4,300 191,700 46,190 $ 145,510 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 $80,600 cash. d. Received cash for the sale of equipment that had cost $71,600, yielding a $4,300 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 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. 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 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 2020. Choose Numerator: 1 Cash Flow on Total Assets Ratio Choose Denominator: = Cash Flow on Total Assets Ratio = Cash flow on total assets ratio =