The following financial statements and additional information are reported. IKIBAN INCORPORATED Comparative Balance Sheets 2021 $ 100,300 83,000 75,800 5,600 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 Sales Cost of goods sold. Gross profit Other gains (losses) Gain on sale of equipment. IKIBAN INCORPORATED Income Statement For Year Ended June 30, 2021 Income before taxes Income taxes expense Net income Operating expenses (excluding depreciation). Depreciation expense 264,700 136,000 (33,000) $367,700 $ 37,000 7,200 4,600 Changes in current operating assets and liabilities Increase in accounts receivable Decrease in prepaid expenses Decrease in accounts payable Decrease in wages payable 48,800 42,000 90,800 Decrease in income taxes payable Decrease in inventory 244,000 32,900 $367,700 Net cash provided by operating activities Cash flows from investing activities Cash paid for equipment Cash received from sale of equipment Cash flows from financing activities Net increase (decrease) in cash Cash balance at prior year-end Cash balance at current year-end 2020 $ 56,000 63,000 104,500 7,800 231,300 127,000 (15,000) $ 343,300 Additional Information a. 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 $69,600 cash. d. Received cash for the sale of equipment that had cost $60,600, yielding a $3,200 gain. $ 48,000 17,400 6,200 e. Prepaid Expenses and Wages Payable relate to Operating Expenses on the income statement. f. All purchases and sales of inventory are on credit. 71,600 72,000 143,600 Required: 1) Prepare a statement of cash flows using the indirect method for the year ended June 30, 2021. Note: Amounts to be deducted should be indicated with a minus sign. STARO 27,700 $ 343,300 $738,000 423,000 315,000 79,000 70,600 165,400 Cash flows from operating activities Net income Adjustments to reconcile net income to net cash provided by operating activities Income statement items not affecting cash Depreciation expense 3,200 168,600 45,090 $123,510 IKIBAN, INCORPORATED Statement of Cash Flows (Indirect Method) For Year Ended June 30, 2021 $ 123,510 70,600 (3,200) (20,000) 28,700 (69,600) $ 199,610 $ (69,600) 0 130,010 $ 130,010