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The following financial statements and additional information are reported. IKIBAN INC. Comparative Balance Sheets June 30, 2019 and 2018 2019 2018 Assets Cash $ 99,700
The following financial statements and additional information are reported.
IKIBAN INC. Comparative Balance Sheets June 30, 2019 and 2018 | ||||||||
2019 | 2018 | |||||||
Assets | ||||||||
Cash | $ | 99,700 | $ | 57,000 | ||||
Accounts receivable, net | 84,500 | 64,000 | ||||||
Inventory | 76,800 | 106,000 | ||||||
Prepaid expenses | 5,700 | 8,000 | ||||||
Total current assets | 266,700 | 235,000 | ||||||
Equipment | 137,000 | 128,000 | ||||||
Accum. depreciationEquipment | (33,500 | ) | (15,500 | ) | ||||
Total assets | $ | 370,200 | $ | 347,500 | ||||
Liabilities and Equity | ||||||||
Accounts payable | $ | 38,000 | $ | 49,500 | ||||
Wages payable | 7,300 | 17,600 | ||||||
Income taxes payable | 4,700 | 6,400 | ||||||
Total current liabilities | 50,000 | 73,500 | ||||||
Notes payable (long term) | 43,000 | 73,000 | ||||||
Total liabilities | 93,000 | 146,500 | ||||||
Equity | ||||||||
Common stock, $5 par value | 246,000 | 173,000 | ||||||
Retained earnings | 31,200 | 28,000 | ||||||
Total liabilities and equity | $ | 370,200 | $ | 347,500 | ||||
IKIBAN INC. Income Statement For Year Ended June 30, 2019 | ||||||
Sales | $ | 743,000 | ||||
Cost of goods sold | 424,000 | |||||
Gross profit | 319,000 | |||||
Operating expenses | ||||||
Depreciation expense | $ | 71,600 | ||||
Other expenses | 80,000 | |||||
Total operating expenses | 151,600 | |||||
167,400 | ||||||
Other gains (losses) | ||||||
Gain on sale of equipment | 3,300 | |||||
Income before taxes | 170,700 | |||||
Income taxes expense | 45,190 | |||||
Net income | $ | 125,510 | ||||
Additional Information
- A $30,000 note payable is retired at its $30,000 carrying (book) value in exchange for cash.
- The only changes affecting retained earnings are net income and cash dividends paid.
- New equipment is acquired for $70,600 cash.
- Received cash for the sale of equipment that had cost $61,600, yielding a $3,300 gain.
- Prepaid Expenses and Wages Payable relate to Other Expenses on the income statement.
- 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, 2019.
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