4. For December 31, 2007, the balance sheet of the Gardner Corporation is as follows: Current Assets Liabilities $ 15,000 22,500 Accounts payable . $ 20,000 Notes payable.. Bonds payable. Cash.. . Accounts receivable.. 30,000 Inventory. Prepaid expenses 37,500 75,000 18,000 Fixed Assets Stockholders' Equity Plant and equipment (gross)... $375,000 Less: Accumulated... depreciation.. Net plant and assets... Total assets... Common stock.. S112,500 Paid-in capital.. Retained earnings... 37,500 75,000 300,000 $393,000 118,000 Total liabilities and stockholders' equity.. $393,000 Sales for the year 2008 were S330,000, with cost of goods sold being 60 percent of sales. Selling and administrative expense was $33,000. Depreciation expense was 10 percent of plant and equipment (gross) at the beginning of the year. Interest expense for the notes payable was 10 percent, while interest on the bonds payable was 12 percent. These were based on December 31, 2007, balances. The tax rate averaged 20 percent. Two thousand dollars in preferred stock dividends were paid and $4,100 in dividends were paid to common stockholders. There were 10,000 shares of common stock outstanding. During the year 2008, the cash balance and prepaid expenses balance were unchanged. Accounts receivable and inventory increased by 20 percent. A new machine was purchased on December 31, 2008, at a cost of $60,000. Accounts payable increased by 30 percent. At year-end, December 31, 2008, notes payable increased by $10,000 and bonds payable decreased by $15,000. The common stock and paid-in capital in excess of par accounts did not change. . Prepare an income statement for the year 2008. b. Prepare a statement of retained earnings for the year 2008. Prepare a balance sheet as of December 31, 2008. .