This is done using the DIRECT method.

The following financial statements and additional information are reported. IKIBAN INC. Comparative Balance Sheets June 30, 2019 and 2018 2019 2018 $ 83,900 74,000 69,800 5,000 232,700 130,000 (30,000 $332,700 $ 50,000 57,000 95,500 6,600 209,100 121,000 (12,080 $318,100 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 par value Retained earnings Total liabilities and equity $ 31,000 6,600 4,000 41,600 31, 200 72,800 $ 39,000 16,200 5.000 60,200 66,00 126,200 232,000 27,900 $332,700 166,020 25,900 5318,100 $ 708,000 417,000 291,000 IKIBAN INC. Income Statement For Year Ended June 30, 2019 Sales Cost of goods sold Gross profit Operating expenses Depreciation expense $64,600 Other expenses 73,000 Total operating expenses Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income 137,600 153,480 2,600 156,000 44.490 $111,510 Additional Information a. A $34,800 note payable is retired at its $34,800 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 $63,600 cash. d. Received cash for the sale of equipment that had cost $54.600, yielding a $2,600 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, 2019. (Amoun indicated with a minus sign.) IKIBAN, INC. Statement of Cash Flows (Direct Method) For Year Ended June 30, 2019 Cash flows from operating activities Net Income $ 111,510 $ 111.510 Cash flows from investing activities 0 Cash flows from financing activities Net increase (decrease) in cash 0 $ 111,510