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Following are account balances (in millions of dollars) from a recent FedEx annual report, followed by several typical transactions. Assume that the following are account balances on May 31 (end of the prior fiscal year):

Account	Balance			Account	Balance
Property and equipment (net)	$	19,943		Receivables	$	5,681
Retained earnings		17,116		Other current assets		830
Accounts payable		2,142		Cash		2,768
Prepaid expenses		549		Spare parts, supplies, and fuel		899
Accrued expenses payable		2,334		Other noncurrent liabilities		6,276
Long-term notes payable		2,107		Other current liabilities		1,726
Other noncurrent assets		4,217		Additional Paid-in Capital		3,132
Common stock ($0.10 par value)		54

These accounts are not necessarily in good order and have normal debit or credit balances. Assume the following transactions (in millions) occurred the next fiscal year beginning June 1 (the current year):

a. Provided delivery service to customers, receiving $32,704 in accounts receivable and $26,400 in cash.

b. Purchased new equipment costing $3,874; signed a long-term note.

c. Paid $18,264 cash to rent equipment and aircraft, with $13,436 for rental this year and the rest for rental next year.

d. Spent $4,304 cash to maintain and repair facilities and equipment during the year.

e. Collected $37,485 from customers on account.

f. Repaid $570 on a long-term note (ignore interest).

g. Issued 240 shares of additional stock for $38.

h. Paid employees $20,776 during the year.

i. Purchased for cash and used $15,164 in fuel for the aircraft and equipment during the year.

j. Paid $1,224 on accounts payable.

k. Ordered $132 in spare parts and supplies.

Required:

1. & 2. Prepare T-accounts for May 31 of the current year from the preceding list; enter the respective beginning balances. For each transaction, record the current year's transaction effects in the T-accounts. Label each using the letter of the transaction. Compute ending balances. (Enter your answers in millions, not in dollars.)

3. Prepare an income statement for the current year ended May 31.