The financial statements of Summit Ltd. includes the following items at December 31, 2025.

Instructionsa. Calculate net income and the ending balance of retained earnings at December 31, 2025. It is not necessary to prepare a formal income statement or retained earnings statement.b. Prepare a balance sheet dated December 31, 2025. Assume that the company will pay $30,500 of the mortgage payable in 2026.

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Accounts payable Accounts receivable Accumulated depreciation- buildings depreciation- Accumulated equipment Buildings Cash Common stock Equipment $ 21,050 20,780 50,600 21,470 133,800 24,040 140,000 66,100 Income tax expense Interest expense Interest payable Land Long-term investments Mortgage payable Operating expenses Prepaid insurance Retained earnings, January 1 Service revenue Supplies $ 5,200 4,550 2,100 194,000 28,970 104,000 158,680 1,420 116,520 183,040 1,240