Question: Refer to the information in Exercise 12-
Refer to the information in Exercise 12-10. Using the direct method, prepare the statement of cash flows for the year ended June 30, 2013.
In Exercise 12-10
The following financial statements and additional information are reported.
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 Other Expenses on the income statement.
f. All purchases and sales of merchandise inventory are on credit.
Transcribed Image Text:
IKIBAN INC. Income Statement For Year Ended June 30, 2013 Sales. $678,000 .. Cost of goods sold 411,000 Gross profit . 267,000 Operating expenses Depreciation' data-toggle="tooltip" data-placement="top" title="Click to view definition...">Depreciation expense Other expenses ... $58,600 67,000 Total operating expenses 125,600 141,400 Other gains (losses) Gain on sale of equipment 2,000 Income before taxes 143,400 Income taxes expense 43,890 Net income $ 99,510 IKIBAN INC. Comparative Balance Sheets June 30, 2013 and 2012 2013 2012 Assets Cash $ 87,500 $ 44,000 Accounts receivable, net 65,000 51,000 Inventory 63,800 86,500 Prepaid expenses 4,400 5,400 Equipment . 124,000 115,000 Accum. depreciation-Equipment (27,000) (9.000) Total assets $317,700 $292,900 Liabilities and Equity' data-toggle="tooltip" data-placement="top" title="Click to view definition...">Equity Accounts payable Wages payable ... Income taxes payable Notes payable (long term) $ 25,000 $ 30,000 6,000 15,000 3,400 3,800 30,000 60,000 Common stock, $5 par value Retained earnings Total liabilities and equity 220,000 160,000 33,300 24,100 $317,700 $292,900
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