Required Information [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 Assets Cash Accounts receivable, net Prepaid expenses Inventory Total current assets Equipment Accumulated depreciation-Equipment Total assets Liabilities and Equity 2020 2019 $ 99,700 184.500 $ 57.000 76,300 2661700 13/1000 (33.500) $ 370 200 64,000 106,900 18.000 2351000 128 000 (151500) $ 847,500 Accounts payable Wages payable Income taxes payable Total current liabilities Notes payable (long term) Total liabilities Equity Common stock, $5 par value Retained earnings Total liabilities and equity KIBAN INCORPORATED Income Statement For Year Ended June 30, 2020 Sales Cost of goods sold Gross profit Depreciation expense Operating expenses (excluding depreciation) Other gains (hosses) Gain on sale of equipment Income before taxes $38.000 $ 49,500 17,600 181700 SEIGE 431000 19Bde8 145,500 246.008 31.200 1/3,000 $307,500 424,000 B131900 167400 13.30 173.200 Income taxes expense Net incote 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 $70.600 cash. d. Received cash for the sale of equipment that had cost $61.600. yielding a $3,300 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 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. IKIBAN, INCORPORATED Statement of Cash Flows (Indirect Method) For Year Ended June 30, 2019 Cash flows from operating activities 125,510 Net income Adjustments to reconcile net income to net cash provided by operating activities Income statement items not affecting cash Depreciation expense Gain on sale of plant assets 71,600 (3,300) Changes in current operating assets and liabilities Increase in accounts receivable Decrease in inventory Decrease in prepaid expenses Decrease in accounts payable Decrease in wages payable Decrease in income taxes payable Net cash provided by operating activities Cash flows from investing activities Cash received from sale of equipment Cash paid for equipment Net cash used in investing activities Cash flows from financing activities Cash received from stock issuance Cash paid to retire notes Cash paid for dividends Net cash used in financing activities Net ncrease (decrease) in cash Cash balance at prior year-end Cash balance at current year-end (20,500) 29.200 3.000 11.500 10.300 1.700 S 229,010 0 S 229,010 S 229,010