Item 10 The following balance sheet and income statement should be used: Hilltop, Inc. 2009 Income Statement Net Sales $38,900 Less: Cost of Goods Sold 31,400 Less: Depreciation 2,600 Earnings Before Interest and Taxes 4,900 Less: Interest Paid 1,800 Taxable Income $3,100 Less: Taxes 1,150 Net Income $1,950 Dividends $390 Additions to retained earnings $1,560 Hilltop, Inc. 2009 Balance Sheet Cash $3,160 Accounts Payable $8,120 Accounts rec 4,160 Long-term debt 21,200 Inventory 6,480 Common stock 7,500 Total $13,800 Retained earnings 6,380 Net fixed assets 29,400 Total assets $43,200 Total liabilities & equity $43,200 Hilltop, Inc. is currently operating at 82% of capacity. The profit margin and the dividend payout ratio are constant