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 2021 2020 $ 100,900 $ 55,000 81,500 74,800 62,000 103,000 5,500 7,600 262,700 227,600 135,000 (32,500) $ 365,200 $ 36,000 7,100 126,000 (14,500) $ 339,100 $ 46,500 17,200 4,500 6,000 47,600 69,700 41,000 71,000 88,600 140,700 242,000 171,000 34,600 27,400 $ 365,200 $ 339,100 Retained earnings Total liabilities and equity IKIBAN INCORPORATED Income Statement Sales For Year Ended June 30, 2021 $ 733,000 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 422,000 311,000 78,000 69,600 163,400 3,100 166,500 44,990 $121,510 Additional Information 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 $68,600 cash. d. Received cash for the sale of equipment that had cost $59,600, yielding a $3,100 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.