Required information [The following information applies to the questions displayed below.] The following financial statements and additional information are reported. IKIBAN INCORPORATED Comparative Balance Sheets At June 30 Assets Cash Accounts receivable, net Prepaid expenses Inventory Total current assets Equipment Accumulated depreciation-Equipment Total assets Liabilities and Equity Accounts payable Wages payable Income taxes payable Total current liabilities Notes payable (long term) Total liabilities Equity Common stock, $5 par value Retained earnings Total liabilities and equity IKIBAN INCORPORATED 2021 2020 $ 100,300 83,000 $ 56,000 75,800 63,000 104,500 5,600 7,800 231,300 264,700 136,000 (33,000) $ 367,700 $ 37,000 7,200 127,000 (15,000) $ 343,300 $ 48,000 17,400 6,200 71,600 4,600 48,800 42,000 72,000 90,800 143,600 244,000 172,000 32,900 27,700 $ 367,700 $ 343,300 Income Statement For Year Ended June 30, 2021 Sales Cost of goods sold Gross profit Operating expenses (excluding depreciation) Depreciation expense Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income Additional Information $ 738,000 423,000 315,000 79,000 70,600 165,400 3,200 168,600 45,090 $ 123,510 a. A $30,000 notes 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 $69,600 cash. d. Received cash for the sale of equipment that had cost $60,600, yielding a $3,200 gain. e. Prepaid Expenses and Wages Payable relate to Operating Expenses on the income statement. f. All purchases and sales of inventory are on credit.