The following financial statements and additional Information are reported. IKIBAN INCORPORATED Comparative Balance Sheets 2021 2020 $ 80,300 $ 56,000 83,000 75,800 63,000 104,500 5,600 7,800 244,700 231,300 136,000 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 Income Statement Sales Cost of goods sold (33,000) $ 347,700 $ 37,000 7,200 127,000 (15,000) $ 343,300 $ 48,000 17,400 4,600 6,200 48,800 71,600 32,400 72,000 81,200 143,600 244,000 172,000 22,500 27,700 $ 347,700 $ 343,300 For Year Ended June 30, 2021 $ 738,000 423,000 315,000 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 79,000 70,600 165,400 3,200 168,600 45,090 $ 123,510 a. A $39,600 note payable is retired at its $39,600 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.