90.2K

Verified Solution

Link Copied!

The following financial statements and additional information are reported. 2016 IKIBAN INC. Comparative Balance Sheets June 30, 2017 and 2016 2017 Assets Cash $106,900 Accounts receivable, net 66,500 Inventory 64,800 Prepaid expenses 4,500 Total current assets 242,700 Equipment 125,000 Accum. depreciation-Equipment (27,500) Total assets $340,200 Liabilities and Equity Accounts payable $ 26,000 Wages payable 6,100 Income taxes payable 3,500 Total current liabilities 35,600 Notes payable (long term) 31,000 Total liabilities 66,600 Equity Common stock, $5 par value 222,000 Retained earnings 51,600 Total liabilities and equity $340,200 $ 45,000 52,000 88,000 5,600 190,600 116,000 (9,500) $297,100 $ 31,500 15,200 4,000 50, 700 61,000 111,700 161,000 24,400 $297, 100 IKIBAN INC. Income Statement For Year Ended June 30, 2017 Sales Cost of goods sold Gross profit Operating expenses Depreciation expense $59,600 Other expenses 68,000 Total operating expenses $683,000 412,000 271,000 127,600 143,400 Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income 145,500 43,990 $101,510 Additional Information 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 $58,600 cash. d. Received cash for the sale of equipment that had cost $49,600, yielding a $2,100 gain. e. Prepaid Expenses and Wages Payable relate to Other Expenses on the income statement. f. All purchases and sales of inventory are on credit. Using the direct method, prepare the statement of cash flows for the year ended June 30, 2017. (Amounts to be deducted should be indicated with a minus sign.) IKIBAN, INC. Statement of Cash Flows (Direct Method) For Year Ended June 30, 2017 Cash flows from operating activities Cash flows from investing activities Cash flows from financing activities Net Increase (decrease) in cash Cash balance at prior year-end Cash balance at current year-end

Answer & Explanation Solved by verified expert

See Answer