Consider the following financial statements for Green Valley Nursing Home, Inc. a for profit long-term care facility: Green Valley Nursing Home Inc. Statement of Income and Retained Earnings Year Ended December 31, 2012

Revenue: Net patient service revenue $3,163,258 Other revenue 106,146

Total revenue $3,269,404 Expenses: Salaries and benefits $1,515,438 Medical supplies and drugs 966,781 Insurance and other 296,357 Provision for bad debts 110,000 Depreciation 85,000 Interest 206,780 Total expenses $3,180,356 Operating Income $89,048 Provision for income tax 31,167 Net Income $57,881 Retained earnings, beginning of year $199,961 Retained earnings, end of year $257,842

Green Valley Nursing Home Inc. Balance Sheet December 31, 2012 Assets Current assets: Cash $105,737 Marketable securities 200,000 Net patient accounts receivables 215,600 Supplies 87,655 Total current assets $608,992 Property and equipment $2,250,000 Less accumulated depreciation 356,000 Net property and equipment $1,894,000 Total assets $2,502,992 Liabilities and Shareholder