Exercise 12-11 Indirect: Preparing statement of cash flows LO P1, P2, P3, A1 (The following information…
The following solution is suggested to handle the subject “Exercise 12-11 Indirect: Preparing statement of cash flows LO P1, P2, P3, A1 (The following information…“. Let’s keep an eye on the content below!
Question “Exercise 12-11 Indirect: Preparing statement of cash flows LO P1, P2, P3, A1 (The following information…”
Exercise 12-11 Indirect: Preparing statement of cash flows LO P1, P2, P3, A1 (The following information applies to the questions displayed below.) The following financial statements and additional information are reported. 2016 IKIBAN INC. Comparative Balance Sheets June 30, 2017 and 2016 2017 Assets Cash $ 93,700 Accounts receivable, net 99,500 Inventory 86,800 Prepaid expenses 6,700 Total current assets 286,700 Equipment 147,000 Accum. depreciation Equipment (38,500) Total assets $395,200 Liabilities and Equity Accounts payable $ 48,000 Wages payable 8,300 Income taxes payable 5,700 Total current liabilities 62,000 Notes payable (long term) 53,000 Total liabilities 115,000 Equity Common stock, $5 par value 266,000 Retained earnings 14,200 Total liabilities and equity $395,200 $ 67,000 74,000 121,000 10,000 272,000 138,000 (20,500) $389,500 $ 64,500 19,600 8,400 92,500 83,000 175,500 183,000 31,000 $389,500
IKIBAN INC. Income Statement For Year Ended June 30, 2017 Sales Cost of goods sold Gross profit Operating expenses Depreciation expense $81,600 Other expenses 90,000 Total operating expenses $793,000 434,000 359,000 171,600 187,400 Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income 4,300 191,700 46,190 $145,510
We were unable to transcribe this image
Exercise 12-11 Part 1 Required: (1) Prepare a statement of cash flows for the year ended June 30, 2017, using the indirect method (Amounts to be deducted should be Indicated with a minus sign.) IKIBAN INC Statement of Cash Flows (Indirect Method) For Year Ended June 30, 2017 | 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 abilities / / / 1 / 1 OTT / TIL NOTRE / lol Cash flows from investing activities Cash flows from financing activities TE Net increase (decrease in cash Cash balance at prior year Cash balance at current year-end
Answer
IKIBAN INC. statement on cash flows Indirect method) for 2017 cash flows from opening Activities net income S 145510 Adjustment to reconcile net Income to net cash provided to operating Activities: Income statements items that do not affect cash Depreciation, Expense Gain from sale of plant Assets. 4200 s. 81600 Change in cunent operational Assets e liabilities – Increased accounts receivable, decrease in inventory, decrease in prepaid expense, and decrease in wages payable. 10 Het cash supplied by operating Activities: Cash flows from investing activities: – cash received through the sale of equipment – cash used for investment. Cash flows from financing Activities: cash received from stock issuance and cash paid to retire bonds. Cash paid for Du net cash used in financing Activities – cash received from STOCK issuance cash paid to retire bonds.
Cash receipt from equipment sold: Accumulated depreciation BG). 613012016 $ 20500 Sale Dep expense 20 SOO+ 81600-38 500) 636600 BO) 613012017 38 500 COOST OF Equipment sold given) (Less: AccumulatedDep. Equipment Sold BOOK Value $ 71600 (636005 S8000 1:4300 12300 Stock Issuance. $ 266000 – $183000 83,000 (3) Dividend: Retained Eaining Nerncome – Retaj San $ 31000 + 1455510 $162310
Conclusion
Above is the solution for “Exercise 12-11 Indirect: Preparing statement of cash flows LO P1, P2, P3, A1 (The following information…“. We hope that you find a good answer and gain the knowledge about this topic of business.