Required information [The following information applies to the questions displayed below.) The following financial statements and additional information are reported. 2019 IKIBAN INC. Comparative Balance Sheets At June 30 2020 Assets Cash $ 92,500 Accounts receivable, net 102,500 Inventory 88,800 Prepaid expenses 6,900 Total current assets 290,700 Equipment 149,000 Accum. depreciation-Equipment (39,500) Total assets $400,200 Liabilities and Equity Accounts payable $ 50,000 Wages payable 8,500 Income taxes payable 5,900 Total current liabilities 64,400 Notes payable (long term) 55,000 Total liabilities 119,400 Equity Common stock, $5 par value 270,000 Retained earnings 10,800 Total liabilities and equity $400,200 $ 69,000 76,000 124,000 10,400 279,400 140,000 (21,500) $397,900 $ 67,500 20,000 8,800 96,300 85,000 181,300 185,000 31,600 $397,900 IKIBAN INC. Income Statement For Year Ended June 30, 2020 Sales Cost of goods sold Gross profit Operating expenses (excluding depreciation) Depreciation expense $ 803,000 436,000 367,000 92,000 83,600 191,400 Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income 4,500 195,900 46,390 $ 149,510 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 $82,600 cash. d. Received cash for the sale of equipment that had cost $73,600, yielding a $4,500 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. Required: (1) Prepare a statement of cash flows using the indirect method for the year ended June 30, 2020. (Amounts to be deducted should be indicated with a minus sign.) Required information IKIBAN, INC. Statement of Cash Flows (Indirect Method) For Year Ended June 30, 2019 Cash flows from operating activities Net income $ 149,510 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 $ 149,510 Cash flows from investing activities Cash flows from financing activities 0 $ 149,510 Net increase (decrease) in cash Cash balance at prior year-end Cash balance at current year-end $ 149,510