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1 The following financial statements and additional information are reported. IKIBAN INC. Comparative Balance Sheets June 30, 2020 and 2019 2020 2019 10 points eBook $ 87,500 65,000 63,800 4,400 220,700 124,000 (27,000) $317,700 $ 44,000 51,000 86,500 5,400 186,900 115,000 (9,000) $292,900 Hint Print References Assets Cash Accounts receivable, net Inventory Prepaid expenses Total current assets Equipment Accum. 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 $ 25,000 6,000 3,400 34,400 30,000 64,400 $ 30,000 15,000 3,800 48,800 60,000 108,800 220,000 33,300 $317,700 160,000 24,100 $292,900 1 IKIBAN INC. Income Statement For Year Ended June 30, 2020 Sales Cost of goods sold Gross profit Operating expenses (excluding depreciation) Depreciation expense 10 points $ 678,000 411,000 267,000 67,000 58,600 141,400 eBook Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income Hint 2,000 143,400 43,890 $ 99,510 Print References 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 $57,600 cash. d. Received cash for the sale of equipment that had cost $48,600, yielding a $2,000 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. Check my work 1 Using the direct method, prepare the statement of cash flows for the year ended June 30, 2020. (Amounts to be deducted should be indicated with a minus sign.) 10 points IKIBAN, INC. Statement of Cash Flows (Direct Method) For Year Ended June 30, 2020 Cash flows from operating activities eBook Hint Print References Cash flows from investing activities points Cash flows from financing activities eBook Hint Print References Net increase (decrease) in cash Cash balance at prior year-end Cash balance at current year-end

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