The accounting records of I.eClaire Delivery Services show the following assets and liabilities as of the end of 2014 and 2013:

During December 2014, the owner, Jess LeClaire, purchased a small office building and moved the business from rented quarters to the new building. The building and the land it occupies cost $112,500. The business paid $60,000 in cash and a note payable was signed for the balance. LeClaire had to invest $17,500 cash in the business to enable it to pay the $60,000. The business earned a net income during 2014, which enabled LeClaire to withdraw $1,500 per month from the business for personal expenses.
Required
1. Prepare balance sheets for the business as of the end of 2013 and the end of 2014.
2. Prepare a calculation to show how much net income was earned by the business during 2014.
Analysis Component: Assets increased from $138,750 at December 31, 2013, to $235,200 at December 31, 2014. Using numbers wherever possible, explain how these assets were financed.