Income Statement year ending 2016 Sales Revenue $500,000 Cost of goods sold 355,000 Fixed costs 58,000 Selling, general, and administrative expenses 25,334 Depreciation 20,000 EBIT Interest expense Taxable Income Taxes Net Income 25,000 * ** Tax rate 40% Dividens paid 5,000 Partial Balance Sheet 12/31/2015 ASSETS LIABILITIES Current Assets Current Liabilities Cash 15,000 Notes payable 10,000 Accounts receivable 35,000 Accounts payable 17,000 Inventories 25,000 Total current liabilities Total current assets Long-term debt 118,000 Total Liabilities Gross Fixed assets OWNERS' EQUITY Accumulated depreciation 100,000 Retained earnings (1) 70,000 Net Fixed assets Common stock 200,000 Intangible assets 0 Total owner's equity TOTAL ASSETS TOTAL LIABILITIES & OWNER'S EQUITY ( These are cumulative retained earnings but textbook simply calls it retained earnings Partial Balance Sheet 12/31/2016 ASSETS LIABILITIES Current Assets Current Liabilities Cash 2,000 Notes payable 20,000 Accounts receivable 20,000 Accounts payable 20,000 Inventories 28.000 Total current liabilities Total current assets Long-term debt Gross Fixed assets Total liabilities 60,000 Accumulated depreciation OWNERS' EQUITY Net Fixed Assets Retained earnings Intangible assets 0 Common stock 200,000 Total long-term assets Total owner's equity TOTAL ASSETS TOTAL LIABILITIES & OWNER'S EQUITY