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[The following information applies to the questions displayed below.] The following financial statements and additional information are reported. At June 30 Assets Cash IKIBAN INCORPORATED Comparative Balance Sheets 2021 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 term) Total liabilities Equity Common stock, $5 par value Retained earnings Total liabilities and equity Sales Cost of goods sold Gross profit Operating expenses (excluding depreciation) Depreciation expense $ 87,500 65,000 Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income 63,800 4,400 220,700 124,000 (27,000) $ 317,700 IKIBAN INCORPORATED Income Statement For Year Ended June 30, 2021 $ 25,000 6,000 3,400 34,400 30,000 64,400 220,000 33,300 $ 317,700 $ 44,000 51,000 2020 186,900 115,000 (9,000) $ 292,900 86,500 5,400 $ 30,000 15,000 3,800 48,800 60,000 108,800 160,000 24,100 $ 292,900 $ 678,000 411,000 267,000 67,000 58,600 141,400 Additional Information a. A $30,000 notes 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. 2,000 143,400 43,890 $ 99,510 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

[The following information applies to the questions displayed below.] The following financial statements and additional information are reported. At June 30 Assets Cash IKIBAN INCORPORATED Comparative Balance Sheets 2021 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 term) Total liabilities Equity Common stock, $5 par value Retained earnings Total liabilities and equity Sales Cost of goods sold Gross profit Operating expenses (excluding depreciation) Depreciation expense $ 87,500 65,000 Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income 63,800 4,400 220,700 124,000 (27,000) $ 317,700 IKIBAN INCORPORATED Income Statement For Year Ended June 30, 2021 $ 25,000 6,000 3,400 34,400 30,000 64,400 220,000 33,300 $ 317,700 $ 44,000 51,000 2020 186,900 115,000 (9,000) $ 292,900 86,500 5,400 $ 30,000 15,000 3,800 48,800 60,000 108,800 160,000 24,100 $ 292,900 $ 678,000 411,000 267,000 67,000 58,600 141,400 Additional Information a. A $30,000 notes 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. 2,000 143,400 43,890 $ 99,510 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

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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[The following information applies to the questions displayed below.] The following financial statements and additional information are reported. At June 30 Assets Cash IKIBAN INCORPORATED Comparative Balance Sheets 2021 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 term) Total liabilities Equity Common stock, $5 par value Retained earnings Total liabilities and equity. Sales Cost of goods sold Gross profit Operating expenses (excluding depreciation) Depreciation expense Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income $ 87,500 65,000 63,800 4,400 220,700 124,000 (27,000) $ 317,700 IKIBAN INCORPORATED Income Statement For Year Ended June 30, 2021 $ 25,000 6,000 3,400 34,400 30,000 64,400 sa 220,000 33,300 $ 317,700 b. The only changes affecting retained earnings are net income and cash dividends paid. $ 44,000 51,000 86,500 5,400 2020 186,900 115,000 (9,000) $ 292,900 $ 30,000 15,000 3,800 48,800 60,000 108,800 160,000 24,100 $ 292,900 Additional Information a. A $30,000 notes payable is retired at its $30,000 carrying (book) value in exchange for cash. $ 678,000 411,000 267,000 67,000 58,600 141,400 2,000 143,400 43,890 $ 99,510 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 Cunnnnnn on the income statamant
Transcribed Image Text:[The following information applies to the questions displayed below.] The following financial statements and additional information are reported. At June 30 Assets Cash IKIBAN INCORPORATED Comparative Balance Sheets 2021 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 term) Total liabilities Equity Common stock, $5 par value Retained earnings Total liabilities and equity. Sales Cost of goods sold Gross profit Operating expenses (excluding depreciation) Depreciation expense Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income $ 87,500 65,000 63,800 4,400 220,700 124,000 (27,000) $ 317,700 IKIBAN INCORPORATED Income Statement For Year Ended June 30, 2021 $ 25,000 6,000 3,400 34,400 30,000 64,400 sa 220,000 33,300 $ 317,700 b. The only changes affecting retained earnings are net income and cash dividends paid. $ 44,000 51,000 86,500 5,400 2020 186,900 115,000 (9,000) $ 292,900 $ 30,000 15,000 3,800 48,800 60,000 108,800 160,000 24,100 $ 292,900 Additional Information a. A $30,000 notes payable is retired at its $30,000 carrying (book) value in exchange for cash. $ 678,000 411,000 267,000 67,000 58,600 141,400 2,000 143,400 43,890 $ 99,510 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 Cunnnnnn on the income statamant
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. Required: (1) Prepare a statement of cash flows using the indirect method for the year ended June 30, 2021. (Amounts to be deducted should be indicated with a minus sign.) 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 Cash flows from investing activities IKIBAN, INCORPORATED Statement of Cash Flows (Indirect Method) For Year Ended June 30, 2021 Cash flows from financing activities Net increase (decrease) in cash Cash balance at prior year-end Cash balance at current year-end
Transcribed Image Text: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. Required: (1) Prepare a statement of cash flows using the indirect method for the year ended June 30, 2021. (Amounts to be deducted should be indicated with a minus sign.) 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 Cash flows from investing activities IKIBAN, INCORPORATED Statement of Cash Flows (Indirect Method) For Year Ended June 30, 2021 Cash flows from financing activities Net increase (decrease) in cash Cash balance at prior year-end Cash balance at current year-end
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