IKIBAN INC. Income Statement For Year Ended June 30, 2017
Sales $678,000
Cost of goods sold 411,000
Gross profit 267,000
Operating expenses
Depreciation expenses $58,600
Other expenses 67,000
Total operating expenses 125,600
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
IKIBAN INC. Comparative Balance Sheets
2017 2016
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
Accum. depreciation-Equipment (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 equity $317,700 $292,900
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 $57,600 cash.
d. Received cash for the sale of equipment that had cost $48,600, yielding a $2,000 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. Prepare the Operating section only of the Statement of Cash Flows for Ikiban Co