The following financial statements and additional information are reported. 2016 IKIBAN INC. Comparative Balance Sheets June 30, 2017 and 2016 2017 Assets Cash $101,500 Accounts receivable, net 80,000 Inventory 73,800 Prepaid expenses 5,400 Total current assets 260,700 Equipment 134,000 Accum. depreciation-Equipment (32,000) Total assets $362,700 Liabilities and Equity Accounts payable $ 35,000 Wages payable 7,000 Income taxes payable 4,400 Total current liabilities 46,400 Notes payable (long term) 40,000 Total liabilities 86,400 Equity Common stock, $5 par value 240,000 Retained earnings 36,300 Total liabilities and equity $362,700 $ 54,000 61,000 101,500 7,400 223,900 125,000 (14,000) $334,900 $ 45,000 17,000 5,800 67,800 70,000 137,800 170,000 27,100 $334,900 IKIBAN INC. Income Statement For Year Ended June 30, 2017 Sales Cost of goods sold Gross profit Operating expenses Depreciation expense $68, 600 Other expenses 77,000 Total operating expenses $728,000 421,000 307,000 145,600 161,400 Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income 3,000 164,400 44,890 $119,510