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Exercise 16-10 Indirect: Preparation of statement of cash flows - IKIBAN INC.

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The following financial statements and additional information are reported.;IKIBAN INC.;Comparative Balance Sheets;June 30, 2013 and 2012;2013 2012;Assets;Cash $ 100,400 $ 61,900;Accounts receivable, net 69,900 51,200;Inventory 66,000 96,600;Prepaid expenses 6,200 5,100;Equipment 127,200 115,000;Accum. depreciation?Equipment (29,000 ) (10,500 );Total assets $ 340,700 $ 319,300;Liabilities and Equity;Accounts payable $ 26,100 $ 32,800;Wages payable 7,600 16,500;Income taxes payable 2,700 4,200;Notes payable (long term) 44,000 70,000;Common stock, $5 par value 235,000 188,000;Retained earnings 25,300 7,800;Total liabilities and equity $ 340,700 $ 319,300;IKIBAN INC.;Income Statement;For Year Ended June 30, 2013;Sales $ 671,000;Cost of goods sold 405,000;Gross profit 266,000;Operating expenses;Depreciation expense $ 58,200;Other expenses 66,800;Total operating expenses 125,000;141,000;Other gains (losses);Gain on sale of equipment 2,500;Income before taxes 143,500;Income taxes expense 57,400;Net income $ 86,100;Additional Information;a. A $26,000 note payable is retired at its $26,000 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 $61,600 cash.;d. Received cash for the sale of equipment that had cost $49,400, yielding a $2,500 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.;rev: 10_03_2013_QC_36920

 

Paper#76821 | Written in 18-Jul-2015

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