The following financial statements and additional information are reported.

IKIBAN INCORPORATED
Comparative Balance Sheets
At June 30	2020	2019
Assets
Cash	$ 87,500	$ 44,000
Accounts receivable, net	65,000	51,000
Inventory	63,800	86,500
Prepaid expenses	4,400	5,400
Total current assets	220,700	186,900
Equipment	124,000	115,000
Accumulated depreciationEquipment	(27,000)	(9,000)
Total assets	$ 317,700	$ 292,900
Liabilities and Equity
Accounts payable	$ 25,000	$ 30,000
Wages payable	6,000	15,000
Income taxes payable	3,400	3,800
Total current liabilities	34,400	48,800
Notes payable (long term)	30,000	60,000
Total liabilities	64,400	108,800
Equity
Common stock, $5 par value	220,000	160,000
Retained earnings	33,300	24,100
Total liabilities and equity	$ 317,700	$ 292,900

IKIBAN INCORPORATED
Income Statement
For Year Ended June 30, 2020
Sales	$ 678,000
Cost of goods sold	411,000
Gross profit	267,000
Operating expenses (excluding depreciation)	67,000
Depreciation expense	58,600
	141,400
Other gains (losses)
Gain on sale of equipment	2,000
Income before taxes	143,400
Income taxes expense	43,890
Net income	$ 99,510

Additional Information

1. A $30,000 note payable is retired at its $30,000 carrying (book) value in exchange for cash.
2. The only changes affecting retained earnings are net income and cash dividends paid.
3. New equipment is acquired for $57,600 cash.
4. Received cash for the sale of equipment that had cost $48,600, yielding a $2,000 gain.
5. Prepaid Expenses and Wages Payable relate to Operating Expenses on the income statement.
6. All purchases and sales of inventory are on credit.