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[The following information applies to the questions displayed below] The following financial statements and additional information are reported. IKIBAN INC. Comparative Balance Sheets June 30,
[The following information applies to the questions displayed below] The following financial statements and additional information are reported. IKIBAN INC. Comparative Balance Sheets June 30, 2019 and 2018 2019 2018 $100,300 83,000 75,800 5,600 264,700 136,000 (33,000) $367, 700 $ 56,000 63,000 104,500 7,800 231,300 127,000 (15.000) $343, 300 Assets Cash Accounts receivable, net Inventory Prepaid expenses Total current assets Equipment Accum. depreciation-Equipment Total assets Liabilities and Equity Accounts payable Wages payable Income taxes payable Total current liabilities Notes payable (long term) Total liabilities Equity Common stock, $5 pan value Retained earnings Total liabilities and equity $ 37,000 7,200 4,600 48,800 42,000 90,800 $ 48,000 17,400 6,200 71,600 72,000 143,600 244,000 32,900 $367,700 172,000 27,700 $ 343,300 $738,000 423,000 315,000 IKIBAN INC Income Statement For Year Ended June 30, 2019 Sales Cost of goods sold Gross profit Operating expenses Depreciation expense $70,600 Other expenses 79,000 Total operating expenses Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income 149,600 165,400 3,200 168,600 45,990 $123,510 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 $69,600 cash. d. Received cash for the sale of equipment that had cost $60,600. yielding a $3,200 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 (1) Prepare a statement of cash flows using the indirect method for the year ended June 30, 2019. (Amounts to be deducted should be indicated with a minus sign) IKIBAN.INC Statement of Cash Flows (Indirect Method) For Yoar Ended June 30, 2019 Cash flows from operating activities Net income $ 123.510 Adjustments to reconcile net income to net cash provided by operating activities Income statement items not affecting cash Depreciation expense 70 600 Gain on sale of plant assets Changes in current operating assets and liabilities Decrease in inventory Decrease in prepaid expenses Decrease in accounts payable Decrease in wages payable Decrease in income taxes payable $ 194, 110 Cash flows from investing activities Cash received from sale of equipment Cash paid for equipment 0 Cash flows from financing activities Cash received from stock issuance Cash paid to retire notes Cash paid for dividends $ 194.110 Net increase (decrease) in cash Cash balance at prior year-end Cash balance at current year-end $ 194 110
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