Consultex, Inc. was founded in 2012 as a small financial consulting business. The company had done reasonably well in 2012-2014 but started noticing its cash dwindle early in 2015. In January 2015, Consultex had paid $16,000 to purchase land and repaid $2,000 principal on an existing promissory note. In March, the company paid $2,000 cash for dividends and $1,000 to repurchase Consultex stock that had previously been issued for $1,000. To improve its cash position, Consultex borrowed $5,000 by signing a new promissory note in May and also issued stock to a new private investor for $12,000 cash. Year-end comparative balance sheets and income statements are presented below. CONSULTEX, INC Balance Sheet October 31 2015 2014 Assets Cash Accounts Receivable Prepaid Rent $11,000 14,000 12,000 3,000 10,000 14,000 2,000 26,000 Total Assets $53,000 $39,000 Liabilities and Stockholders' Equity Salaries and Wages Pay Income Taxes Payable Notes Payable (long-term) Common Stock Retained Earnings able $ 2,000 $3,000 1.000 12,000 9,000 14,000 1,000 15,000 20,000 15,000 Total Liabilities and Stockholders Equity $53,000 39,000 CONSULTEX, INC Income Statement For the Year Ended October 31 2015 2014 Sales Revenue Salaries and Wages Expense Rent Expense Utilities Expenses $158,000 161,000 97,000 30,000 20,000 98,000 36,000 19,700 Income before Income Tax Expense Income Tax Expense 4,300 1,300 14,000 4,200 Net Income $ 3,000 $ 9,800