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Exercise 16-11 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.) KIBAN, INO. 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 iabilities Cash flows from investing activities Cash flows from financing activities Net increase (decrease) in cash Cash balance at prior year-end Cash balance at current year-end

Answer 1

IKIBAN INC. Statement of Cash Flows (Indirect Method) For the Years Ended June 30, 2017 Particulars Amount ( $) Cash Flows from Operating Net Income before tax Adjustment to reconcile net income to net cash provided by op Activities 1,79,100 ivities Income statement items not affecting cash Depreciation Gain on sale of equipment 75600 3700 251000 Changes in Current Operating Assets&Liabiliies Add Decrease in Inventory Add Decrease in Prepaid Expenses Subtract Decrease in Accounts Pavable Subtract Increase in Accounts Receivable 31200 2700 13500 22500

10700 238200 Subtract Decrease in Wages Pavable 47690 S1,90,510 l ax Expenses Net Cash from Operating Activities Cash Flows from Investing Activities Decrease in Note Payables Sale of Euipment Purchase of New Equipment S30,000 11700 74600 Net Cash Used for Investing Activities Cash Flows from Financing Activities Dividend paid S92,900 77,000 138310 Issue of new Net Cash from Financing Activities Net Increase (decrease) in cash Cash balance at prior year - end Cash balance at current vear end -S61,310 S36,300 61000 S97,300

Note l:- Income tax payable account Particulars Amount Particulars Amount 7200 45590 To Bank (paid) 47690 Opening Balance Closing Balance 5100 Profit & Loss 52790 Note 2:- Equipment account Amount Particulars 132000 Sale of Euipment Account Particulars Amount 65600 141000 Opening Balance 74600 Closing Balance 206600 To Bank 206600

Note 3:- Accumulated Depreciation account Particulars Amount Particulars Amount Sale of Euipment Account 57600 Opening Balance 17500 Closing Balance 35500 93100 Depreciation during the year 93100 Note 4: Sale of Euipment Account Particulars Amount Particulars Amount 57600 11700 Euipment Account 65600 Accumulated Depreciation Account Gain on Sale of Euipment 3700 Cash Received on sale 69300 69300