Question
The following financial statements and additional information are reported. Additional Information a. A $30,000 note payable is retired at its $30,000 carrying (book) value in
The following financial statements and additional information are reported.
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 $57,600 cash.
d. Received cash for the sale of equipment that had cost $48,600, yielding a $2,000 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, 2015, using the indirect method.
2. Compute the company's cash flow on total assets ratio for its fiscal year 2015.
Thanks for the help in advance!
IKIBAN INC. Income Statement For Year Ended June 30, 2015 Sales Cost of goods sold Gross profit Operating expenses $678,000 411,000 267,000 . ....$58,600 67,000 Depreciation expense Total operating expenses Other gains (losses) 125,600 141,400 2,000 143,400 43,890 $99,510 Gain on sale of equipment Income before taxes Income taxes expense Net income . .. IKIBAN INC. Comparative Balance Sheets June 30, 2015 and 2014 2014 2015 Assets Cash $87,500 44,000 Accounts receivable, net . . 65,000 51,000 63,800 86,500 Inventory 4400 5.400 Prepaid expenses 220,700 186,900 124,000 115 Total current assets . Accum. depreciation-Equipment Liabilities and Equity Wages payable . . . (9,000) 317.700 $292,900 15,000 3,4003,600 48,800 6,000 Income taxes payable . . . . Total current liabilities. 34,400 30,000 60,00 Total liabilities . . . . Equity Common stock, $5 par value Retained earnings . . . 64,400 108,800 . 220,000 160,000 33,300 24.100 . $317.700 $292900Step by Step Solution
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