GL1201 (Algo) - Based on Exercise 12-11 LO P2, P3, A1 Use the following financial statements and additional Information SANCHEZ INCORPORATED Comparative Balance Sheets June 30, 2019 and 2018 2019 2018 $ 101,300 68,000 69,000 5,7ee 244,000 179,000 (45,eee) $ 378,000 $ 48,900 53, eee 96,000 7,100 205,000 166,000 (15,eee) $ 356,000 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 tern) Total liabilities Equity Common stock, $5 par value Retained earnings Total liabilities and equity $ 33,000 7,eee 3,600 43,608 43,000 86,600 $ 40,000 17,000 4,000 61,000 85,000 146, eee 250,000 41,400 $ 378,000 188, eee 3e, eee $ 356,000 SANCHEZ INCORPORATED Income Statement For Year Ended June 30, 2019 Sales Cost of goods sold Gross profit Operating expenses Depreciation expense 5 77, ece other expenses 93,00 Total operating expenses $940,000 575, eee 365,000 $ 170,000 195, eee other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income 5,200 200,200 61,280 $ 138,92e Additional Information a. A $42,000 note payable is retired at its $42.000 carrying (book) value in exchange for cash, b. The only changes affecting retained earnings are net income and cash dividends pald, c. New equipment is acquired for $75,000 cash. d. Received cash for the sale of equipment that had cost $62,000. ylelding a $5.200 gain. e. Prepaid Expenses and Wages Payable relate to Other Expenses on the income statement 1. All purchases and sales of Inventory are on credit Requirement General Journal General Ledger Trial Balance Direct Method Indirect Method Prepare the Statement of Cash flows for the year ended June 30, 2019 using the Direct Method. Hint Use the Cash T- account on the General Ledger tab to identify the sources and uses of cash. List cash outflows as negative values Unadjusted SANCHEZ INCORPORATED Statement of Cash Flows (Direct Method) For Year Ended June 30, 2019 Cash flows from operating activities Cash flows from investing activities Cash flows from financing activities Additional Information 1. A $42,000 note payable is retired at its $42.000 carrying (book) value in exchange for cash b. The only changes affecting retained earnings are net Income and cash dividends pald. c. New equipment is acquired for $75,000 cash. d. Received cash for the sale of equipment that had cost $62,000. ylelding a $5.200 gain. e. Prepaid Expenses and Wages Payable relate to Other Expenses on the Income statement 1. All purchases and sales of Inventory are on credit Requirement General Journal General Ledger Trial Balance Direct Method Indirect Method Prepare the operating activities section of the statement of cash tows using the indirect method. Enter reductions to net cash provided by operating activities as negative values. Unadjusted SANCHEZ INCORPORATED Statement of Cash Flows (Indirect Method) For Year Ended June 30, 2019 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