Question

The following financial statements and additional information are reported. IKIBAN INC. Comparative Balance Sheets June 30, 2019 and 2018 2019 2018 $ 106,300 68,000 65,800 4,600 244,700 126,000 (28,000) $342,700 $ 46,000 53,000 89,500 5,800 194,300 117,000 (10,000) $301,300 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 $ 27,000 6,200 3,600 36,800 32,000 68,800 $ 33,000 15,400 4,200 52,600 62,000 114,600 224,000 49,900 $342,700 162,000 24,700 $301,300 IKIBAN INC. Income Statement For Year Ended June 30, 2019 Sales Cost of goods sold Gross profit Operating expenses Depreciation expense $60,600 Other expenses 69,000 Total operating expenses $688,000 413,000 275,000 129,600 145,400 Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income 2,209 147,600 44,090 $ 103,510 Additional Information LA.. AAAF denn con

Answer 1

1,47,600.00 60,600.00 -2,200.00 2,06,000.00 STATEMENT OF CASH FLOW Cash flows from operating activities Profit before taxation Adjustments for: Depreciation (Profit) / Loss on the sale of property, plant & equipment Cash flows from operating activities before Working Capital Changes Working capital changes: (Increase) / Decrease in trade and other receivables (Increase) / Decrease in inventories (Increase) / Decrease in prepaid expenses Increase / (Decrease) in trade payables Increase / (Decrease) in customer advance Cash generated from operations Tax Paid Net cash from operating activities 1 2 B -15,000.00 23,700.00 1,200.00 -6,000.00 -9,200.00 2,00,700.00 44,690.00 1 5 =44090+4200-3600 7 1,56,010.00 3

Cash flows from investing activities Purchase of property, plant and equipment Proceeds from sale of equipment Net cash used in investing activities -59,600.00 10,200.00 Note-1 -49,400.00 -30,000.00 62,000.00 -78,310.00 -46,310.00 Note-2 Cash flows from financing activities Payment of Notes Proceeds from Equity Issue Payment of dividend Net cash used in financing activities Net increase in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period 60,300.00 46,000.00 1,06,300.00

Note-1 Property Plant & Equipment Opening Value Purchase Gain Depreciation related to Sold Asset Closing balance Sale of Land 1,17,000.00 59,600.00 2,200.00 42,600.00 1,26,000.00 10,200.00 Less Accumlated Dep(Opening) Current year Depreciation Accumlated Dep(Closing) Depreciation related to Sold Asset 10,000.00 60,600.00 28,000.00 42,600.00 Note-2 Opening Retained Earning Current Year Profit Closing (Should be) Actual Difference Assumed it is Dividend Paid 24,700.00 1,03,510.00 1,28,210.00 49,900.00 78,310.00