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The following financial statements and additional information are reported. IKIBAN INCORPORATED Comparative Balance Sheets At June 30 Assets 2020 2019 Cash Accounts receivable, net $
The following financial statements and additional information are reported. IKIBAN INCORPORATED Comparative Balance Sheets At June 30 Assets 2020 2019 Cash Accounts receivable, net $ 96,100 93,500 $ 63,000 Prepaid expenses Inventory Total current assets Equipment Accumulated depreciation-Equipment Total assets 82,800 6,300 70,000 115,000 9,200 278,700 257,200 143,000 (36,500) $ 385,200 Liabilities and Equity Accounts payable $ 44,000 Wages payable 7,900 Income taxes payable 5,300 134,000 (18,500) $ 372,700 $ 58,500 18,800 7,600 Total current liabilities 57,200 84,900 Notes payable (long term) 49,000 79,000 Total liabilities 106,200 163,900 Equity Common stock, $5 par value 258,000 179,000 Retained earnings 21,000 29,800 Total liabilities and equity $ 385,200 $ 372,700 IKIBAN INCORPORATED Income Statement For Year Ended June 30, 2020 Sales $ 773,000 Cost of goods sold Gross profit Operating expenses (excluding depreciation) Depreciation expense Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income 430,000 343,000 86,000 77,600 179,400 3,900 183,300 45,790 $ 137,510 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 $76,600 cash. d. Received cash for the sale of equipment that had cost $67,600, yielding a $3,900 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 Cash flows from operating activities Statement of Cash Flows (Indirect Method) For Year Ended June 30, 2019 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 Changes in current operating assets and liabilities 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
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