The following financial statements and additional information are reported. IKIBAN INCORPORATED Comparative Balance Sheets At June 30 Assets Cash Accounts receivable, net Inventory Prepaid expenses 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 Income Statement 2021 2020 $ 106,300 68,000 $ 46,000 53,000 65,800 89,500 4,600 5,800 244,700 194,300 126,000 (28,000) $ 342,700 $ 27,000 6,200 3,600 117,000 (10,000) $ 301,300 $ 33,000 15,400 4,200 36,800 52,600 32,000 62,000 68,800 114,600 224,000 162,000 49,900 24,700 $ 342,700 $ 301,300 Sales Cost of goods sold For Year Ended June 30, 2021 Gross profit Operating expenses (excluding depreciation) Depreciation expense Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income $ 688,000 413,000 275,000 69,000 60,600 145,400 2,200 147,600 44,090 $ 103,510 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. Drov