The following financial statements and additional information are reported. ÎKI ÎAN INC.
Comparative Balance Sheets
June 30, 2018 and 2017
2018 2017
Assets
Cash $72,500 $69,000
Accounts receivable, net 102,500 76,000
Inventory 88,800 124,000
Prepaid expenses 6,900 10,400
Total current assets 270,700 279,400
Equipment 149,000 140,000
Accum. depreciation-Equipment (39,500) (21,500)
Total assets $380,200 $397,900
Liabilities and Equity
Accounts payable $50,000 67,500
Wages payable 8,500 20,000
Income taxes payable 64,400 96,300
Notes payable (long term) 5,900 8,800
Total current liabilities 55,000 85,000
Total liabilities 119,400 181,300
Equity
Common stock, $5 par value 270,000 185,000
Retained earnings 9,200 31,600
Total liabilities and equity $380,200 $397,900
IKIBAN INC
Income Statement
For Year Ended June 30, 2018
Sales $803,000
Cost of goods sold 436,000
Gross profit 367,000
Operating expenses
Depreciation expense $83,600
Other expenses 92,000
Total operating expenses 175,600
Other gains (losses) 191,400
Gain on sale of equipment 4,500
Income before taxes 195,900
Income taxes expense 46,390
Net income $149,510
Additional Information
A $50,000 note payable is retired at its $50,000 carrying (book) value in exchange for cash.
The only changes affecting retained earnings are net income and cash dividends paid.
New equipment is acquired for $82,600 cash.
Received cash for the sale of equipment that had cost $73,600, yielding a $4,500 gain.
Prepaid Expenses and Wages Payable relate to Other Expenses on the income statement.
All purchases and sales of inventory are on credit.
Compute the company's cash flow on total assets ratio for its fiscal year 2018.