The following financial statements and additional information are reported. IKIBAN INCORPORATED…
The following financial statements and additional information are reported. IKIBAN INCORPORATED Comparative Balance Sheets At June 30 2021 2020 Assets Cash $ 76,700 $ 62,000 Accounts receivable, net 92,000 69,000 Inventory 81,800 113,500 Prepaid expenses 6,200 9,000 Total current assets 256,700 253,500 Equipment 142,000 133,000 Accumulated depreciation-Equipment (36,000) (18,000) Total assets $ 362,700 $ 368,500 Liabilities and Equity Accounts payable $ 43,000 $ 57,000 Wages payable 7,800 18,600 Income taxes payable 5,200 7,400 Total current liabilities 56,000 83,000 Notes payable (long term) 33,600 78,000 Total liabilities 89,600 161,000 Equity Common stock, $5 par value 256,000 178,000 Retained earnings 17,100 29,500 Total liabilities and equity $ 362,700 $ 368,500 IKIBAN INCORPORATED Income Statement For Year Ended June 30, 2021 Sales Cost of goods sold Gross profit Operating expenses (excluding depreciation) Depreciation expense Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income $ 768,000 429,000 339,000 85,000 76,600 177,400 3,800 181,200 45,690 $ 135,510 Additional Information a. A $44,400 note payable is retired at its $44,400 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 $75,600 cash. d. Received cash for the sale of equipment that had cost $66,600, yielding a $3,800 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. May 16 2022 03:13 PM
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