Comparative Balance Sheets At June 30 Assets Cash Accounts receivable, net Prepaid expenses Inventory Total current assets Equipment Accumulated depreciation Equipment Total assets Liabilities and Equity $ 395,200 Accounts payable $ 48,000 Wages payable 8,300 Income taxes payable 5,700 2021 $ 93,700 99,500 86 800 6,700 286 700 147,000 (38,500) 2020 $ 67,000 74,000 121,000 10,000 272,000 138,000 (20,500) $ 389,500 $ 64,500 19,600 8,400 Total current liabilities 62,000 92,500 Notes payable (long term) 53,000 83,000 Total liabilities 115,000 175,500 Equity Common stock, $5 par value 266,000 183,000 Retained earnings 14,200 31,000 Total liabilities and equity $ 395,200 $ 389,500 IKIBAN INCORPORATED Income Statement For Year Ended June 30, 2021 Sales Cost of goods sold Gross profit Operating expenses (excluding depreciation) Depreciation expense Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income Additional Information $ 793,000 434,000 359,000 90,000 81,600 187,400 4.300 191,700 46,190 $ 145,510 a. A $30,000 notes payable is retired at its $30,000 carrying (book) value in exchange for cash. b. The only changes affecting retained earnings are net income and cash dividends paid. c. New equipment is acquired for $80,600 cash. d. Received cash for the sale of equipment that had cost $71,600, yielding a $4,300 gain. e. Prepaid Expenses and Wages Payable relate to Operating Expenses on the income statement. f. All purchases and sales of Inventory are on credit. Pre