The following financial statements and additional information are reported. IKIBAN INCORPORATED Comparative Balance Sheets At June...
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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 Prepaid expenses 2021 2020 $ 98,500 87,500 $ 59,000 Inventory 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 78,800 66,000 109,000 5,900 8,400 270,700 242,400 139,000 (34,500) $ 375,200 $ 40,000 7,500 4,900 130,000 (16,500) $ 355,900 $ 52,500 18,000 6,800 52,400 77,300 45,000 75,000 97,400 152,300 250,000 175,000 27,800 28,600 Total liabilities and equity $ 375,200 $ 355,900 Sales Cost of goods sold IKIBAN INCORPORATED Income Statement For Year Ended June 30, 2021 $ 753,000 426,000 327,000 82,000 Gross profit Operating expenses (excluding depreciation) Depreciation expense Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income 73,600 171,400 3,500 174,900 45,390 $ 129,510 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 $72,600 cash. d. Received cash for the sale of equipment that had cost $63,600, yielding a $3,500 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. Exercise 16-12 (Algo) Part 1 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. The following financial statements and additional information are reported. IKIBAN INCORPORATED Comparative Balance Sheets At June 30 Assets Cash Accounts receivable, net Prepaid expenses 2021 2020 $ 98,500 87,500 $ 59,000 Inventory 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 78,800 66,000 109,000 5,900 8,400 270,700 242,400 139,000 (34,500) $ 375,200 $ 40,000 7,500 4,900 130,000 (16,500) $ 355,900 $ 52,500 18,000 6,800 52,400 77,300 45,000 75,000 97,400 152,300 250,000 175,000 27,800 28,600 Total liabilities and equity $ 375,200 $ 355,900 Sales Cost of goods sold IKIBAN INCORPORATED Income Statement For Year Ended June 30, 2021 $ 753,000 426,000 327,000 82,000 Gross profit Operating expenses (excluding depreciation) Depreciation expense Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income 73,600 171,400 3,500 174,900 45,390 $ 129,510 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 $72,600 cash. d. Received cash for the sale of equipment that had cost $63,600, yielding a $3,500 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. Exercise 16-12 (Algo) Part 1 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.
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To prepare the statement of cash flows using the indirect method we need to analyze the changes in various balance sheet accounts and consider the add... View the full answer
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