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The following financial statements and additional information are reported. IKIBAN INCORPORATED Comparative Balance Sheets 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 2021 $ 101,500 80,000 73,800 5,400 260,700 134,000 (32,000) $ 362,700 $ 35,000 7,000 4,400 46,400 40,000 86,400 240,000 36,300 $362,700 IKIBAN INCORPORATED Income Statement For Year Ended June 30, 2021 2020 $ 54,000 61,000 101,500 7,400 223,900 125,000 (14,000) $ 334,900 $ 45,000 17,000 5,800 67,800 70,000 137,800 170,000 27,100 $ 334,900

The following financial statements and additional information are reported. IKIBAN INCORPORATED Comparative Balance Sheets 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 2021 $ 101,500 80,000 73,800 5,400 260,700 134,000 (32,000) $ 362,700 $ 35,000 7,000 4,400 46,400 40,000 86,400 240,000 36,300 $362,700 IKIBAN INCORPORATED Income Statement For Year Ended June 30, 2021 2020 $ 54,000 61,000 101,500 7,400 223,900 125,000 (14,000) $ 334,900 $ 45,000 17,000 5,800 67,800 70,000 137,800 170,000 27,100 $ 334,900

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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Required information [The following information applies to the questions displayed below.] The following financial statements and additional information are reported. 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 current liabilities Notes payable (long term) Total liabilities Equity Common stock, $5 par value Retained earnings Total liabilities and equity 2021 $ 101,500 80,000 73,800 5,400 260,700 134,000 (32,000) $ 362,700 $ 35,000 7,000 4,400 46,400 40,000 86,400 240,000 36,300 $362,700 IKIBAN INCORPORATED Income Statement For Year Ended June 30, 2021 2020 $ 54,000 61,000 101,500 7,400 223,900 125,000 (14,000) $ 334,900 $ 45,000 17,000 5,800 67,800 70,000 137,800 170,000 27,100 $ 334,900
Transcribed Image Text:Required information [The following information applies to the questions displayed below.] The following financial statements and additional information are reported. 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 current liabilities Notes payable (long term) Total liabilities Equity Common stock, $5 par value Retained earnings Total liabilities and equity 2021 $ 101,500 80,000 73,800 5,400 260,700 134,000 (32,000) $ 362,700 $ 35,000 7,000 4,400 46,400 40,000 86,400 240,000 36,300 $362,700 IKIBAN INCORPORATED Income Statement For Year Ended June 30, 2021 2020 $ 54,000 61,000 101,500 7,400 223,900 125,000 (14,000) $ 334,900 $ 45,000 17,000 5,800 67,800 70,000 137,800 170,000 27,100 $ 334,900
For Sales Cost of goods sold Gross profit IKIBAN INCORPORATED Income Statement Year Ended June 30, 2021 Operating expenses (excluding depreciation) Depreciation expense Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income $728,000 421,000 307,000 77,000 68,600 161,400 3,000 164,400 44,890 $ 119,510 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 $67,600 cash. d. Received cash for the sale of equipment that had cost $58,600, yielding a $3,000 gain. IKIBAN, INCORPORATED 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.)
Transcribed Image Text:For Sales Cost of goods sold Gross profit IKIBAN INCORPORATED Income Statement Year Ended June 30, 2021 Operating expenses (excluding depreciation) Depreciation expense Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income $728,000 421,000 307,000 77,000 68,600 161,400 3,000 164,400 44,890 $ 119,510 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 $67,600 cash. d. Received cash for the sale of equipment that had cost $58,600, yielding a $3,000 gain. IKIBAN, INCORPORATED 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.)
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