LAG Network Inc.'s balance sheet and income statement are as follows: LAG Network Inc. Income Statement For Year Ended December 31, 2020 Sales $934,600 Cost of goods sold 562,200 Gross profit $372,400 Operating expenses: Depreciation expense $ 25,200 Other expenses 238,800 Total operating expenses Profit from operations 264,000 $108,400 Income taxes Profit 24,600 $ 83,800 LAG Network Inc. Comparative Balance Sheet Information December 31 Assets 2020 Cash $ 81,250 2019 $ 55,600 Accounts receivable 48,400 38,800 Merchandise inventory 281,650 256,200 Equipment 160,400 139,600 Accumulated depreciation (77,800) (52,600) Total assets $493,900 $437,600 Liabilities and Equity Accounts payable $ 37,200 Income taxes payable 17,600 $ 49,800 16,200 Common shares 369,000 328,500 Retained earnings 70,100 43,100 Total liabilities and $493,900 $437,600 equity Additional information regarding LAG Network Inc.'s activities during 2020: a. Equipment is purchased for $20,800 cash. b. 16,200 common shares are issued for cash at $2.50 per share. c. Declared and paid $56,800 of cash dividends during the year. Other information regarding LAG Network Inc.: a. All sales are credit sales. b. All credits to accounts receivable are receipts from customers. c. All purchases of merchandise are on credit. d. All debits to accounts payable result from payments for merchandise. e. Other operating expenses are cash expenses. f. The only decrease in income taxes payable is for payment of taxes.