h. Faubert exchanged an old machine for a similar machine on December 31, Year 5. Original cost of the old machine was $66,000; Updated accumulated depreciation was $30,000. The newer machine had a fair value of $38,000; Faubert received $2,000 in the exchange. The exchange did not have commercial substance, but Faubert recorded the event as if the event had commercial substance. Faubert Company Income Statements For Year Ended December 31 Year 5 For Year Ended December 31 Year 4 Sales Cost of Goods Sold $850,000 (340,000) $800,000 (400,000) Gross Profit $510,000 $400,000 Operating Expenses: Insurance (9,000) (29,000) Wages Depreciation (229,000) (140,000) (230,000) (130,000) Income from Operations $132,000 $11,000 Other Revenues and Expenses: Interest Revenue Bad Debt Expense Rent Revenue Gain on Exchange of Machine 28,000 (4,300) 23,000 4,000 30,000 (4,400) 25,000 -0- Net Income $182.700 $61,600 Faubert Company Balance Sheets December 31, Year 5 December 31, Year 4 Assets Current Assets Cash and Equivalents Receivables (net of allowance) Inventories Prepaid Expenses and Other Assets Total Current Assets $580,100 220,500 85,000 30,300 915,900 $340,000 196,000 75,000 22,500 633,500 Land Plant and Machines, Net Other Assets Total Assets 72,000 320,000 28,300 $1,336,200 90,000 275,000 29,800 $1,028,300 Liabilities and Shareholders' Equity Current Liabilities Accounts Payable Rent Payable Unearned Revenue Wages Payable Current Portion of Long-Term Debt Total Current Liabilities $59,000 61,000 4,000 17,000 10,000 151,000 $10,400 43,000 3,000 2,400 $58,800 Long-Term Debt Total Liabilities 30,000 $181,000 40,000 98,800 Shareholders' Equity Common Stock Additional Paid-In Capital Retained Earnings Treasury Stock (at cost) Total Shareholders' Equity Total Liabilities and Shareholders' Equity 100,000 792,000 314,100 (50,900) 1,155,200 $1,336,200 100,000 749,000 131,400 (50,900) 929,500 $1,028,300 REQUIRED 1. Correcting journal entries, if applicable, for items a. through j. If no correcting journal entry is needed, indicate "No CJE." 2. Corrected and restated Year 5/Year 4 Faubert comparative income statement and balance sheet