Required information [The following information applies to the questions displayed below.] The following financial statements and additional information are reported IKIBAN INC Comparative Balance Sheets June 30, 2017 and 2016 2017 2816 Assets Cash $ 87,500 65,000 63,800 $ 44,000 51,000 86,see 5,400 186,900 115,000 (9,000) Accounts receivable, net Inventory Prepaid expenses Total current assets Equipment Accum. depreciation-Equipment 4,400 220,700 124,000 (27,000) $317,700 Total assets $292,900 Liabilities and Equity Accounts payable Wages payable Income taxes payable Total current liabilities Notes payable (long term) 25,000 6,e00 $ 30,000 15,e00 3,800 48,800 3,400 34,400 30,e00 60,000 Total liabilities 108,800 64,400 Equity Common stock, $5 par value Retained earnings 160,000 24,100 $292,900 220,000 33,300 Total liabil1ities and equity $317,700 IKIBAN INC. Incone Statenent For Year Ended June 30, 2017 Sales Cost of goods sold Gross profit Operating expenses Depreciation expense other expenses Total operating expenses $678,000 411,000 267,000 $58,600 67,000 125,600 141,400 other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense 2,000 143,400 43,890 99,510 Net income Additional Information a. A $30,000 note payable is retired at its $30,000 carrying (book) value in exchange for cash. b. The only changes affecting retained earnings are net income and cash dividends paid. c. New equipment is acquired for $57,600 cash. d. Received cash for the sale of equipment that had cost $48,600, yielding a $2,000 gain. e. Prepaid Expenses and Wages Payable relate to Other Expenses on the income statement f. All purchases and sales of inventory are on credit