Required information [The following information applies to the questions displayed below.] The following financial statements and additional information are reported. 2016 IKIBAN INC. Comparative Balance Sheets June 30, 2017 and 2016 2017 Assets Cash $100,300 Accounts receivable, net 83,000 Inventory 75,800 Prepaid expenses 5,600 Total current assets 264,700 Equipment 136,000 Accum. depreciation-Equipment (33,000) Total assets $367,700 Liabilities and Equity Accounts payable $ 37,000 Wages payable 7,200 Income taxes payable 4,600 Total current liabilities 48,800 Notes payable (long term) 42,000 Total liabilities 90,800 Equity Common stock, $5 par value 244,000 Retained earnings 32,900 Total liabilities and equity $367,700 $ 56,000 63,000 104,500 7,800 231,300 127,000 (15,000) $343,300 $ 48,000 17,400 6,200 71,600 72,000 143,600 172,000 27,700 $343, 300 IKIBAN INC. Income Statement For Year Ended June 30, 2017 Sales Cost of goods sold Gross profit Operating expenses Depreciation expense $70,600 Other expenses 79,000 Total operating expenses $ 738,000 423,000 315,000 149,600 165,400 Other gains (losses) Gain on sale of equipment 3,200 IKIBAN INC. Income Statement For Year Ended June 30, 2017 Sales Cost of goods sold Gross profit Operating expenses Depreciation expense $70,600 Other expenses 79,000 Total operating expenses $ 738,000 423,000 315,000 149,600 165,400 Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income 3,200 168,600 45,090 $123,510 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 $69,600 cash. d. Received cash for the sale of equipment that had cost $60,600, yielding a $3,200 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 $ 0 Cash flows from investing activities 0 Cash flows from financing activities Cash received from stock issuance Decrease in prepaid expenses 0 $ 0 Net increase (decrease) in cash Cash balance at prior year-end Cash balance at current year-end $ 0