The following financial statements and additional information are reported.

IKIBAN INC.

Income Statement

For Year Ended June 30, 2016

IKIBAN INC.
Comparative Balance Sheets
June 30, 2016 and 2015

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 $57,600 cash.
d. Received cash for the sale of equipment that had cost $48,600, yielding a $2,000 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.
Required
1. Prepare a statement of cash flows for the year ended June 30, 2016, using the indirect method.
2. Compute the company's cash flow on total assets ratio for its fiscal year 2016?

Transcribed Image Text:

Sales... $678,000 411,000 267,000 Gross profit Depreciation expense Total operating expenses Other gains (losses) .$58,600 67,000 6125600 141.400 Gain on sale of equipment. Income before taxes . Income taxes expense... Net income 2,000 143,400 43,890 $99,510 Assets Cash.... Accounts receivable, net.. 87,500 44,000 Accum. depreciation Equipmend Liabilities and Equity 25,000 30,000 Total current liabilities.... Notes payable (long term) Common stock, $5 par value Total liabilities and equity $317.700 $292.900