Mint Cleaning Inc. prepared the following unadjusted trial balance at the end of its second year of operations ending December 31.

Account Titles	Debit			Credit
Cash	$	55
Accounts Receivable		4
Prepaid Insurance		7
Equipment		114
Accumulated Depreciation				$	0
Accounts Payable					4
Common Stock					110
Retained Earnings					14
Sales Revenue					122
Insurance Expense		0
Salaries and Wages Expense		27
Supplies Expense		43
Totals	$	250		$	250

Other data not yet recorded at December 31:
a.	Insurance expired during the year, $5.
b.	Depreciation expense for the year, $4.
c.	Wages payable, $7.
d.	Income tax expense, $9. By what amount would net income have been understated or overstated had the adjusting journal entries not been recorded? Required: Using the above adjusted balances, prepare an income statement. Required: Using the above adjusted balances, prepare a statement of retained earnings.