Required information [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, 2017 and 2016 2017 2016 Assets Cash Accounts receivable, net Inventory Prepaid expenses Total current assets Equipment Accum. depreciation-Equipment Total assets $104,500 49,000 56,000 94,000 6,400 205,400 120,000 (11,500 $350,200 313,900 72,500 68,800 4,900 250,700 129,000 (29,500) 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 30,000 37,500 16,000 4,800 58,300 35,000 65,000 123,300 6,500 3,900 40,400 75,400 165,000 25,600 $350,200 313,900 230,000 44,800 Total liabilities and equity IKIBAN INC. Income Statement For Year Ended June 30, 2017 Sales Cost of goods sold Gross profit Operating expenses $703,000 416,000 287,000 $63,600 72,000 Depreciation expense Other expenses Total operating expenses 135,600 151,400 Other gains (losses) 2,500 153,900 44,390 $109,510 Gain on sale of equipment Income before taxes Income taxes expense Net income 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 $62,600 cash d. Received cash for the sale of equipment that had cost $53,600, yielding a $2,500 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. Required: (1) Prepare a statement of cash flows for the year ended June 30, 2017, using the indirect method. (Amounts to be deducted should be indicated with a minus sign.) IKIBAN, INC Statement of Cash Flows (Indirect Method) For Year Ended June 30, 2017 Cash flows from operating activities 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