### Additional Informationa. A $30,000 notes 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 $75,600 cash.d. Received cash for the sale of equipment that had cost $66,600, yielding a $3,800 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, 2021. **(Amounts to be deducted should be indicated with a minus sign.)**---#### IKIBAN, INCORPORATED**Statement of Cash Flows (Indirect Method)** **For Year Ended June 30, 2021**- **Cash flows from operating activities** - 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(Note: Specific figures and detailed calculations would be inserted as part of completing the statement.) The following financial statements and additional information are reported.**IKIBAN INCORPORATED****Comparative Balance Sheets** At June 30 | | 2021 | 2020 ||----------------|--------|--------|| **Assets** | | || Cash | $96,700 | $62,000 || Accounts receivable, net | 92,000 | 69,000 || Inventory | 81,800 | 113,500 || Prepaid expenses | 6,200 | 9,000 || **Total current assets** | 276,700 | 253,500 || Equipment | 142,000 | 133,000 || Accumulated depreciation—Equipment | (36,000) | (18,000) || **Total assets** | $382,700 | $368,500 || **Liabilities and Equity** | | || Accounts payable | $43,000 | $57,000 || Wages payable | 7,800 | 18,600 || Income taxes payable | 5,200 | 7,400 || **Total current liabilities** | 56,000 | 83,000 || Notes payable (long term) | 48,000 | 78,000 || **Total liabilities** | 104,000 | 161,000 || **Equity** | | || Common stock, $5 par value | 256,000 | 178,000 || Retained earnings | 22,700 | 29,500 || **Total liabilities and equity** | $382,700 | $368,500 |---**IKIBAN INCORPORATED** **Income Statement** For Year Ended June 30, 2021| | ||----------------|--------|| **Sales** | $768,000 || Cost of goods sold | 429,000 || **Gross profit** | 339,000 || Operating expenses (excluding depreciation) | 85,000 || Depreciation expense | 76,600 || **Other gains (losses)** | || Gain on sale of equipment | 3,800 |

Statement of Cash Flow - Statement of Cash Flow includes inflow and outflow of cash during the…

The following financial statements and additional information are reported. IKIBAN INCORPORATED Comparative Balance Sheets 2021 At June 30 Assets Cash 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 current liabilities Notes payable (long term) Total liabilities Equity Common stock, $5 par value Retained earnings Total liabilities and equity For Sales Cost of goods sold Gross profit $ 96,700 92,000 81,800 6,200 276,700 142,000 (36,000) $ 382,700 Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income $ 43,000 7,800 5,200 56,000 48,000 104,000 256,000 22,700 $382,700 IKIBAN INCORPORATED Income Statement Year Ended June 30, 2021 Operating expenses (excluding depreciation) Depreciation expense 2020 $ 62,000 69,000 113,500 9,000 253,500 133,000 (18,000) $368,500 $ 57,000 18,600 7,400 83,000 78,000 161,000 178,000 29,500 $368,500 $ 768,000 429,000 339,000 85,000 76,600 177,400 3,800 181,200 45,690 $ 135,510

The following financial statements and additional information are reported. IKIBAN INCORPORATED Comparative Balance Sheets 2021 At June 30 Assets Cash 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 current liabilities Notes payable (long term) Total liabilities Equity Common stock, $5 par value Retained earnings Total liabilities and equity For Sales Cost of goods sold Gross profit $ 96,700 92,000 81,800 6,200 276,700 142,000 (36,000) $ 382,700 Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income $ 43,000 7,800 5,200 56,000 48,000 104,000 256,000 22,700 $382,700 IKIBAN INCORPORATED Income Statement Year Ended June 30, 2021 Operating expenses (excluding depreciation) Depreciation expense 2020 $ 62,000 69,000 113,500 9,000 253,500 133,000 (18,000) $368,500 $ 57,000 18,600 7,400 83,000 78,000 161,000 178,000 29,500 $368,500 $ 768,000 429,000 339,000 85,000 76,600 177,400 3,800 181,200 45,690 $ 135,510

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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