The following financial statements and additional information are reported IKIBAN INC Comparative Balance Sheets June 30, 2017 and 2016 2017 2016 Assets Cash Accounts receivable, net Inventory Prepaid expenses Total current assets Equipment Accum. depreciation-Equipment Total assets $ 97,900 60,000 67,000 110,500 8,600 246,100 131,000 17,000 $377,700 $360,100 89,000 79,800 6,000 272,700 140,000 (35,000) Liabilities and Equity Accounts payable Wages payable Income taxes payable Total current liabilities Notes payable (long term) Total liabilities Equity Common stock, $5 par value Retained earnings 41,000 7,600 5,000 53,600 54,000 18,200 7,000 79,200 46000 76,000 155,200 99,600 252,000 26,100 176, 000 28,900 $377,700 $360,100 Total liabilities and equity IKIBAN INC. Income Statement For Year Ended June 30, 2017 Sales $758,000 427,000 331,000 Cost of goods sold Gross profit Operating expenses Depreciation expense $74,600 83,000 Other expenses Total operating expenses 157,600 173,400 Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income 3,600 177,000 45,490 $131,510 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 $73,600 cash. d. Received cash for the sale of equipment that had cost $64,600, yielding a $3,600 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 Using the direct method, prepare the statement of cash flows for the year ended June 30, 2017. (Amounts to be deducted should be indicated with a minus sign.) IKIBAN, INC Statement of Cash Flows (Direct Method) For Year Ended June 30, 2017 Cash flows from operating activities 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 0