Joyner Company's income statement for Year 2 follows: Sales Cost of goods sold Gross margin $900,000 500,000 400,000 Selling and administrative expenses 328,000 72,000 Net operating income Nonoperating items: Gain on sale of equipment Income before taxes Income taxes Net income 8,000 80,000 24,000 $ 56,000 Its balance sheet amounts at the end of Years 1 and 2 are as follows: Assets Cash Accounts receivable Inventory 310,000 Prepaid expenses 7,000 Year 2 Year 1 $ 4,000 250,000 $ 21,000 170,000 260,000 14,000 Total current assets 571,000 465,000 Property, plant, and equipment 510,000 400,000 Less accumulated depreciation 132,000 120,000 Net property, plant, and equipment 378,000 280,000 Loan to Hymans Company 40,000 0 Total assets $989,000 $745,000 Liabilities and Stockholders' Equity Accounts payable $310,000 $250,000 Accrued liabilities 20,000 30,000 Income taxes payable 45,000 42,000