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 95,500 64,000 71,000 83,800 116, 500 9,400 280,700 260,900 144,000 135, 000 (37,000) (19,000) 95,000 Accounts receivable, net Inventory Prepaid expenses Total current assets Equipment Accum. depreciation-Equipment Total assets Liabilities and Equity Accounts payable Wages payable 6,400 387,700 376,900 $45,000 60,000 19,000 7, 800 86, 800 80,000 166, 800 8,000 5,400 58,400 50,000 108,400 Income taxes payable Total current liabilities Notes payable (long term) Total liabilities Equity Common stock, $5 par value Retained earnings Total liabilities and equity 260,000 180,000 30, 100 19,300 $387,700 376,900 IKIBAN INC. Income Statement For Year Ended June 30, 2017 Sales Cost of goods sold Gross profit Operating expenses $778,000 431,000 347,000 Depreciation expense Other expenses $78,600 87,000 165,600 181,400 Total operating expenses Other gains (losses) 4,000 185,400 45,890 $139,510 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 $77,600 cash. d. Received cash for the sale of equipment that had cost $68,600, yielding a $4,000 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.) KIBAN, 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 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