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Required Information Exercise 12-11 Indirect: Preparing statement of cash flows LO P1, P2, P3, A1 The following Information a
1 Incose taxes expense 45,690 Net income $135,518 Additional Information 1 of 2 a. A $30,000 note payable is retlired at its
IKIBAN, INC Statement of Cash Flows (Indirect Method) For Year Ended June 30, 2017 Cash flows from operating activities Adjus
IKIBAN INC. Income Statement For Year Ended June 30, 2817 Sales $768,eee 429,0ee 339, eee Cost of goods sold Gross profit Ope
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IKIBAN INC.
Statement of Cash Flows
For the Year ended June 30th 2017
A. Cash Flows from Operating Activity
Net Income $    135,510.00
Adjustments to reconcile net income to net cash flows from Operating Activities
Income statement items not affecting cash
Depreciation expense $           76,600.00
Gain on sale of Equipment $           (3,800.00)
Cahnges In Current Operating Assets Liabilities
Increase in Accounts Receivable $        (23,000.00)
Decrease in Inventory $           31,700.00
Decrease in Prepaid Expenses $             2,800.00
Decrease in Accounts Payable $        (14,000.00)
Decrease in Wages Payable $        (10,800.00)
Decrease in Income taxes payable $           (2,200.00)
$      57,300.00
Net cash flow from Operating activities $    192,810.00
B. Cash flows from Investing Activities
Cash paid for Equipment $        (75,600.00)
Cash received from Sale Of Equipment $           11,800.00
Net Cash Used in Investing activities $    (63,800.00)
C. Cash Flows from Financing activities
Cash paid to retire notes $        (30,000.00)
Cash received from stock issuance $           78,000.00
Cash paid for Dividends $      (142,310.00)
Cash flows from Financing activities $    (94,310.00)
Net Increase (Decrease) in Cash [A+B+C] $      34,700.00
Cash balance at prior Year-end $      62,000.00
Cash balance at Current Year-end $      96,700.00

.

Cash flow on total assets ratio
Operating Cash flow / Average Total Assets = Cash flow on total assets ratio
$     192,810.00 $     375,600.00 =           0.51

Working

Cash received on sale of Equipment
Cost of equipment sold $       66,600.00
Less: Accumulated depreciation $       58,600.00
Book value of asset sold $         8,000.00
Profit on sale $         3,800.00
Cash received on sale of equipment $       11,800.00

.

Accumulated depreciation on equipment sold
Accumulated Depreciation beginning balance $       18,000.00
Add: Depreciation of current year $       76,600.00
Subtotal $       94,600.00
Ending balance of Accumulated depreciation $       36,000.00
Depreciation on asset sold $       58,600.00

.

Calculation of dividend paid   
Beginning balance of retained earnings   $       29,500.00
Add: Net income   $    135,510.00
$    165,010.00
Less: Ending balance of Retained earnings   $       22,700.00
Dividends paid in cash   $    142,310.00
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