Required information P3-6 (Algo) Analyzing the Effects of Transactions Using T-Accounts, Preparing an Income Statement, and Evaluating the Net Profit Margin Ratio LO3-4, 3-5, 3-6 [The following information applies to the questions displayed below.] Following are account balances (in millions of dollars) from a recent StateEx annual report, followed by several typical transactions. Assume that the following are account balances on May 31 (end of the prior fiscal year): Account Balance Account Balance Property and equipment $16,694 Receivables $2,249 (net) Retained earnings 12,406 Other current assets 1,019 Accounts payable 1,537 Cash 1,164 Prepaid expenses 248 Spare parts, supplies, 678 and fuel Other noncurrent Accrued expenses payable 2,350 3,710 liabilities Long-term notes payable 1,770 Other current liabilities 2,219 Additional Paid-in Other noncurrent assets 2,972 1,027 Capital Common stock ($0.10 par value) 5 These accounts are not necessarily in good order and have normal debit or credit balances. Assume the following transactions (in millions, except for par value) occurred the next fiscal year beginning June 1 (the current year): a. Provided delivery service to customers, who paid $8,390 in cash and owed $33,504 on account. b. Purchased new equipment costing $3,714; signed a long-term note. c. Paid $10,664 cash to rent equipment and aircraft, with $5,236 for rent this year and the rest for rent next year. d. Spent $1,144 cash to repair facilities and equipment during the year. e. Collected $32,685 from customers on account. f. Repaid $290 on a long-term note (ignore interest). g. Issued 160 million additional shares of $0.10 par value stock for $30 (that's $30 million). h. Paid employees $12,776 for work during the year. i. Purchased spare parts, supplies, and fuel for the aircraft and equipment for $10,764 cash. j. Used $7,150 in spare parts, supplies, and fuel for the aircraft and equipment during the year. k. Paid $1,064 on accounts payable. I. Ordered $116 in spare parts and supplies. P3-6 Part 3 3. Prepare an unadjusted income statement for the current year ended May 31. StateEx Income Statement (unadjusted) (in millions)