Using the worksheets that follow this one, prepare in good form: (read notes at bottom also) 2018 Year-End Financial Statements for Botswana Tea Company, Inc. 1.) Multi-step Income Statement Instructions: 2.) Classified Balance Sheet 3.) Statement of Retained Earnings Accounts payable Accounts receivable Accumulated depreciation - building Accumulated depreciation- store equipment 4,400 31,250 252,600 25,500 Allowance for bad debts 4,020 Amortization expense 725 Bad debt expense 3,600 Bank overdraft 2,500 130,000 Bonds payable Building Cash 348,000 36,780 Cash surrender value of life insurance 3 Common stock, $2 par 15,000 135,400 Cost of goods sold Depreciation expense - building Depreciation expense- store equipment Discount on bonds payable Dividends 245,520 13,500 6,000 10,000 25,000 Gain on disposition of plant asset 28,465 Goodwill 28,000 2 Income from Water Division (discontinued) 1 Income tax expense (for income from continuing operations) Insurance expense 18,500 19,300 1,200 1,100 Interest expense Interest payable 200 Land 60,000 Land held for future use 14,050 2 Loss on disposal of Water Division 6,200 Merchandise inventory 16,800 Notes payable, due June 15, 2019 10,000 Notes payable, due May 20, 2020 Office rent expense Paid in capital in excess of par, common stock 25,000 6,400 40,600 Patent 7,600 Prepaid insurance 800 Rent revenue 12,630 Retained earnings, January 1, 2018 49,690 Sales discounts 12,140 Sales revenue 395,000 Store equipment Supplies Supplies Expense Unearned revenue 162,500 440 600 15,000 Utilities expense 2,200 Wages & salaries expense- office Wages & salaries expense- selling 30,000 44,800 1. This account represents the income tax expense for continuing operations. 2. The company disposed of their flavored water division this year. The account balances above are shown net of the applicable income tax: Notes: Income tax expense applicable to Water Division income: $5,750 Income tax expense applicable to Water Division disposal: $1,480 3. All stock is both issued and outstanding. 4. Expenses related to the store and to selling are listed as selling expenses. (Most of the expenses are administrative.)