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Check my w Required information Exercise 16-11 Indirect: Preparing statement of cash flows LO P1, P2, P3, A1 [The following information applies to the questions displayed below.) The following financial statements and additional information are reported. 2016 IKIBAN INC. Comparative Balance Sheets June 30, 2017 and 2016 2017 Assets Cash $184,500 Accounts receivable, net 72,500 Inventory 68,888 Prepaid expenses 4,900 Total current assets 250,700 Equipment 129,800 Accum. depreciation Equipment (29,500) Total assets $350,200 Liabilities and Equity Accounts payable $ 30,000 Wages payable 6,500 Income taxes payable 3,900 Total current liabilities 40,400 Notes payable (long term) 35,000 Total liabilities 75,400 Equity Common stock, $5 par value 230,000 Retained earnings 44,800 Total liabilities and equity $350,200 $ 49,000 56,000 94,800 6,400 285,480 120,000 (11,508) $313,900 $ 37,500 16,000 4,800 58,300 65,000 123,300 165,000 25,600 $313, 9ee IKIBAN INC. Income Statement For Year Ended June 30, 2017 Sales Cost of goods sold Gross profit Operating expenses Depreciation expense $63,600 Other expenses 72,000 Total operating expenses $703,000 416,000 287,000 135,600 151,400 Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income 2,500 153,900 44,390 $199,510 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 $62,600 cash. d. Received cash for the sale of equipment that had cost $53,600, yielding a $2.500 gain e. Prepaid Expenses and Wages Payable relate to Other Expenses on the income statement All purchases and sales of inventory are on credit The He Exercise 16-11 Part 1 Required: (1) Prepare a statement of cash flows for the year ended June 30, 2017, using the indirect me deducted should be indicated with a minus sign.) IKIBAN, INC. Statement of Cash Flows (Indirect Method) For Year Ended June 30, 2017 Cash flows from operating activities Net income $ 109,510 Adjustments to reconcile net income to net cash provided by operating activities Income statement items not affecting cash Depreciation expense 63,600 Gain on sale of plant assets (2,500) Changes in current operating assets and liabilities Increase in accounts receivable Decrease in inventory Decrease in prepaid expenses Decrease in accounts payable Decrease in wages payable Decrease in income taxes payable (16,500) 25,200 1,500 (7,500) (9,500) (900) $ 162,910 Net cash provided by operating activities Cash flows from investing activities Cash received from sale of equipment Cash paid for equipment 0 Net cash used in investing activities Cash flows from financing activities Cash received from stock issuance Cash paid to retire notes Cash paid for dividends 0 $ 162,910 Net cash used in financing activities Net increase (decrease) in cash Cash balance at prior year-end Cash balance at current year-end $ 162,910