The Tollowing inrormation applies to the questions aisplayed beloW. The following financial statements and additional information are reported IKIBAN ING Comparative Balance Sheets June 30, 2018 and 2017 2018 2017 Assets Cash Accounts receivable, net Inventory Prepaid expenses Total current assets Equipment Accum. depreciation-Equipment Total assets $86,900 66,500 64,800 4,500 222,700 125,000 45,000 52,000 88,000 5,600 190,600 116,000 (27,500) 9,500) $320,200 $297,100 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 1iabilities and equity $ 26,000 6,100 3,500 35,600 31,000 66,600 31,500 15,200 4,000 50,700 61,000 111,700 222,000 31,600 161,000 24,400 $320,200 297,100 IKIBAN INC IKIBAN ING Income Statement For Year Ended June 30, 2018 Sales Cost of goods sold Gross profit Operating expenses $683,000 412,000 271,000 $59,600 68,000 Depreciation expense Other expenses Total operating expenses 127,600 143,400 Other gains (losses) 2,100 145,500 43,990 $101,510 Gain on sale of equipment Income before taxes Income taxes expense Net income Additional Information a. A $30,000 note 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. c. New equipment is acquired for $58,600 cash d. Received cash for the sale of equipment that had cost $49,600, yielding a $2,100 gain. e. Prepaid Expenses and Wages Payable relate to Other Expenses on the income statement. f. All purchases and sales of inventory are on credit. Cash flows from operating activities Net income Adjustments to reconcile net income to net cash provided by operating activities Income statement items not affecting cash Gain on sale of plant assets Changes in current operating assets and liabilities 0 Cash flows from investing activities Cash flows from financing activities 0 Net increase (decrease) in cash Cash balance at prior year-end Cash balance at current year-end