Income Statement and Retained Earnings The Huff Company presents the following partial list of account balances taken from its December 31, 2019 adjusted trial balance: Sales (net) $122,000 Operating expenses $27,300 Interest expense 3,100 Common stock, $5 par 22,000 Cost of goods sold 58,000 Retained earnings, 1/1/2019 42,700 The following information is also available for 2019 and is not reflected in the preceding accounts: 1. The common stock has been outstanding all year. A cash dividend of $1.02 per share was declared and paid. 2. Land was sold at a pretaz gain of $5,100. 3. Division X (a major component of the company) was sold at a pretax gain of $4,660. It had incurred a $9,410 pretax operating loss during 2019. 4. A tornado, which is an unusual event in the area, caused a $5,360 pretax loss. 5. The income tax rate on all items of income is 30%. 6. The average shareholders' equity is $90,000. Required: Sales (net) $ 122,000 Cost of goods sold 58,000 Gross profit $ 64,000 27,300 36,700 > Operating expenses Operating income Other items Gain on sale of land Loss caused by tornado Interest expense Pretax income from continuing operations Income tax expense Old) Income from continuing operations S Results from discontinued operations Loss from operations of discontinued division X (net of income tax credit) Gain on disposal of division X (net of income taxes) Net income Components of Income Income from continuing operations Results from discontinued operations Earnings per Comm $ Net income 2. Prepare a 2019 retained earnings statement. HUFF COMPANY Statement of Retained Earnings For Year Ended December 31, 2019 Retained earnings, 1/1/2019 42,700 Add: Net income for 2019 Less: Cash dividends Retained earnings, 12/31/2019 Feedback 3. Compute the 2019 return on common equity. Round to one decimal place. %