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Required information [The following information applies to the questions displayed below.] The following financial statements and additional information are reported. IKIBAN INCORPORATED Comparative Balance
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 2021 2020 Cash $ 104,500 $ 49,000 Accounts receivable, net Inventory 72,500 68,800 56,000 94,000 Prepaid expenses 4,900 Total current assets Equipment 250, 700 129,000 (29,500) 120,000 (11,500) 6,400 205,400 Accumulated depreciation-Equipment Total assets Liabilities and Equity Accounts payable Income taxes payable Wages payable Total current liabilities Notes payable (long term) Total liabilities Equity Common stock, $5 par value Retained earnings Total liabilities and equity Sales Cost of goods sold $350, 200 $ 313,900 $ 30,000 $ 37,500 6,500 16,000 3,900 4,800 40,400 58,300 35,000 65,000 75,400 123,300 230,000 165,000 44,800 25,600 $ 350,200 $313,900 IKIBAN INCORPORATED Income Statement For Year Ended June 30, 2021 $ 703.000 416.000 287,000 72,000 Gross profit Operating expenses (excluding depreciation) Depreciation expense Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income Additional Information 63.600 151,400 2.500 153.900 44.390 $ 109,510 a. A $30,000 notes 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 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, 2021. (Amounts to be deducted should be indicated with a minus sign.)
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