nents. used for proprietorships? of corporations and P13-10B Carlotta's Cakes Inc. is a private company reporting under ASPE. It is authorized to issue an unlimited number of common and $3 cumulative preferred shares. The following is an alphabetical list of its adjusted accounts at May 31, 2017, its fiscal year end. All accounts have normal balances. Accounts payable $ 38,500 Income tax expense $11.230 Accounts receivable 15,300 Insurance expense 7.500 Accumulated depreciation equipment 126,000 Interest expense 4,500 Cash 20,600 Inventory 70,220 Cash dividends-common 50,000 Notes payable 75,000 Cash dividends-preferred 7,500 Preferred shares 150,000 Common shares 50,000 Rent expense 24,500 Cost of goods sold 277,475 Retained earnings 73,000 Depreciation expense 42,000 Salaries expense 67,800 Dividend payable 7.500 Sales 504,500 Equipment 420,000 Supplies expense 5,875 The note payable is due in 2019. There are 10,000 common shares issued and 5,000 preferred shares issued as at May 31, 2017 Instructions Prepare an income statement, statement of retained carnings, and balance sheet. TAKING IT FURTHER What ethical issues may managers face when reporting a company's financial performance? for three fiscal years