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0, yielding a $4,300 gain. e. Prepaid Expenses and Wages Payable relate to Operating Expenses on the income statement. f. 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, 2020. Note: Amounts to be deducted should be indicated with a minus sign. IKIBAN, INCORPORATED

0, yielding a $4,300 gain. e. Prepaid Expenses and Wages Payable relate to Operating Expenses on the income statement. f. 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, 2020. Note: Amounts to be deducted should be indicated with a minus sign. IKIBAN, INCORPORATED

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Please do all parts from A to F thank you
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 $80,600 cash. d. Received cash for the sale of equipment that had cost $71,600, yielding a $4,300 gain. e. Prepaid Expenses and Wages Payable relate to Operating Expenses on the income statement. f. 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, 2020. Note: Amounts to be deducted should be indicated with a minus sign. Cash flows from operating activities IKIBAN, INCORPORATED Statement of Cash Flows (Indirect Method) For Year Ended June 30, 2019 Adjustments to reconcile net income to net cash provided by operating activities Income statement items not affecting cash Changes in current operating assets and liabilities Prox 8 of 11 ‒‒‒ Next
Transcribed Image Text: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 $80,600 cash. d. Received cash for the sale of equipment that had cost $71,600, yielding a $4,300 gain. e. Prepaid Expenses and Wages Payable relate to Operating Expenses on the income statement. f. 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, 2020. Note: Amounts to be deducted should be indicated with a minus sign. Cash flows from operating activities IKIBAN, INCORPORATED Statement of Cash Flows (Indirect Method) For Year Ended June 30, 2019 Adjustments to reconcile net income to net cash provided by operating activities Income statement items not affecting cash Changes in current operating assets and liabilities Prox 8 of 11 ‒‒‒ Next
At June 30 Assets Cash IKIBAN INCORPORATED Comparative Balance Sheets Accounts receivable, net Inventory Prepaid expenses - Total current assets Equipment Accumulated depreciation-Equipment Total assets Liabilities and Equity Accounts payable Wages payable Income taxes payable Total ent liabilities Notes payable (long term) Total liabilities Equity Common stock, $5 par value Retained earnings Total liabilities and equity Sales Cost of goods sold Gross profit Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income $ 93,700 99,500 86,800 6,700 Additional Information 2020 286,700 147,000 (38,500) $ 395,200 IKIBAN INCORPORATED Income Statement For Year Ended June 30, 2020 $ 48,000 8,300 5,700 62,000 53,000 115,000 Operating expenses (excluding depreciation) Depreciation expense 266,000 14,200 $ 395,200 $ 67,000 74,000 121,000 10,000 2019 272,000 138,000 (20,500) $ 389,500 $ 64,500 19,600 8,400 92,500 83,000 175,500 183,000 31,000 $ 389,500 $ 793,000 434,000 359,000 90,000 81,600 187,400 4,300 191,700 46,190 $ 145,510
Transcribed Image Text:At June 30 Assets Cash IKIBAN INCORPORATED Comparative Balance Sheets Accounts receivable, net Inventory Prepaid expenses - Total current assets Equipment Accumulated depreciation-Equipment Total assets Liabilities and Equity Accounts payable Wages payable Income taxes payable Total ent liabilities Notes payable (long term) Total liabilities Equity Common stock, $5 par value Retained earnings Total liabilities and equity Sales Cost of goods sold Gross profit Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income $ 93,700 99,500 86,800 6,700 Additional Information 2020 286,700 147,000 (38,500) $ 395,200 IKIBAN INCORPORATED Income Statement For Year Ended June 30, 2020 $ 48,000 8,300 5,700 62,000 53,000 115,000 Operating expenses (excluding depreciation) Depreciation expense 266,000 14,200 $ 395,200 $ 67,000 74,000 121,000 10,000 2019 272,000 138,000 (20,500) $ 389,500 $ 64,500 19,600 8,400 92,500 83,000 175,500 183,000 31,000 $ 389,500 $ 793,000 434,000 359,000 90,000 81,600 187,400 4,300 191,700 46,190 $ 145,510
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