The following financial statements and additional Information are reported. IKIBAN INCORPORATED Comparative Balance Sheets At June 30 2021 2020 Assets Cash Accounts receivable, net $ 73,100 101,000 $ 68,000 Prepaid expenses Inventory Total current assets Equipment Accumulated depreciation-equipment Total assets Liabilities and equity Accounts payable Mages payable Income taxes payable Total current liabilities Notes payable (long term) Total liabilities Equity Connon stock, $5 par value 87,800 75,000 122,100 4,800 10,200 268,700 271,700 148,000 139,000 (30,000) $377,700 $ 49,000 8,400 (21,000) $ 393,700 $ 80,000 19,800 1,800 8,000 3,200 94,400 34,800 $4,000 98,000 178,400 258,000 184,000 Retained earnings 11,700 31,300 Total liabilities and equity $ 377,700 $ 393,700 IKIBAN INCORPORATED Income Statement Sales Cost of goods sold Gross profit Operating expenses (excluding depreciation) Depreciation expense For year ended June 30, 2021 $ 798,000 +31,000 383,000 91,000 82,500 189,400 4,400 193,800 48,290 $ 147,510 Other gains (losses) Gain on sale of equipment Incone before taxes Income taxes expense Net Incone Additional Information a. A $49,200 note payable is retired at its $49,200 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 $81,600 cash. d. Received cash for the sale of equipment that had cost $72,600, yielding a $4,400 gain. e. Prepaid Expenses and Wages Payable relate to Operating Expenses on the Income statement. 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, 2021. Note: Amounts to be deducted should be indicated with a minus sign. Answer is not complete. IKIBAN, INCORPORATED Statement of Cash Flows (Direct Method) For Year Ended June 30, 2021 Cash flows from operating activities Net Income 5772,000 Depreciation expense x (417,300) Gain on sale of plant assets (99,000) Cash paid for inventory x 49,090 Gain on sale of plant asses Net cash provided by operating 5 304,790 activities Cash flows from Investing activities Cash paid for equipment (81,600) Cash received from sale of equipment 12,400 Cash paid for operating expenses (69,200) Cash flows from financing activities Cash received from stock issuance 84,000 Increase in accounts receivable x (167,110) Cash paid to retire notes 0 (49,200) Net cash used in financing activities (132,310) Net Increase (decrease) in cash Cash balance at prior year-end Cash balance at current year-end 103,280 68,000 5 171,280