Required information Exercise 16-11 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, 217 and 216 217 216 Assets Cash Accounts receivable, net Inventory Prepaid expenses Total current assets Equipment Accum. depreciation-Equipment Total assets 74,000 69,800 5, 000 57, 000 95, 500 6,600 121,00G0 (30,000) 12,000) $318, 10 $352, 7 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 6,600 4, 000 16,200 5, 000 36, 166, 25,900 $318,100 232,000 43,100 $352,700 Total liabilities and equity For Year Ended June 30, 27 Sales Cost of goods sold Gross profit Operating expenses $708,000 417, Depreciation expense $64, 6 73, 000 Other expenses Total operating expenses 137,606 153,40 2,600 44,490 Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income $111,510 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 $63,600 cash d. Received cash for the sale of equipment that had cost $54,600, yielding a $2,600 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