Problem 4-04 The following account balances were included in the trial balance of Waterway Corporation at June 30, 2020. Sales revenue $1,589,100 Depreciation expense (office furniture and equipment) $7,364 Sales discounts 32,320 Property tax expense 7,162 Cost of goods sold 903,300 Bad debt expense (selling) 5,229 Salaries and wages expense (sales) 57,960 Maintenance and repairs expense (administration) 8,940 Sales commissions 98,100 Office expense 6,140 Travel expense (salespersons) 34,000 Sales returns and allowances 62,236 Delivery expense 23,400 Dividends received 39,100 Entertainment expense 15,050 Interest expense 18,310 Telephone and Internet expense (sales) 9,090 Income tax expense 92,300 Depreciation expense (sales equipment) 5,162 Depreciation understatement due to error-2020 (net of tax) 17,506 Maintenance and repairs expense (sales) 5,990 Dividends declared on preferred stock 9,280 Miscellaneous selling expenses 5,066 Dividends declared on common stock 37,000 Office supplies used 3,460 Telephone and Internet expense (administration) 3,018 The Retained Earnings account had a balance of $331,960 at July 1, 2019. There are 82,400 shares of common stock outstanding. Using the multiple-step form, prepare an income statement for the year ended June 30, 2020. (Round earnings per share to 2 decimal places, e.g. 1.48.) WATERWAY CORPORATION Income Statement For the Year Ended June 30, 2020 Sales Sales Revenue Less Sales Discounts Sales Returns and Allowances Net Sales Cost of Goods Sold Gross Profit/ (Loss) Operating Expenses Selling Expenses Salaries and Wages Expense Sales Commissions Travel Expense Delivery Expense Entertainment Expense Telephone and Internet Expense Depreciation Expense Maintenance and Repairs Expense Miscellaneous Selling Expenses Bad Debt Expense Total Selling Expenses Administrative Expenses Office Expenses Telephone and Internet Expense Depreciation Expense Property Tax Expense Maintenance and Repairs Expense Office Expenses Total Administrative Expenses Income from Operations Other Revenues and Gains Dividend Revenue Other Expenses and Losses Interest Expense Income Before Income Tax Income Tax Net Income / (Loss) Earnings Per Common Share SHOW LIST OF ACCOUNTS LINK TO TEXT LINK TO TEXT LINK TO TEXT LINK TO TEXT Prepare a retained earnings statement for the year ended June 30, 2020. (List items that increase adjusted retained earnings first.) WATERWAY CORPORATION Retained Earnings Statement For the Year Ended June 30, 2020 Retained Earnings, July 1, 2019, as Reported Correction of Depreciation Understatement Retained Earnings, July 1, 2019, as Adjusted Add : Net Income / (Loss) Less Dividends Declared on Preferred Stock