P1-1A The assets and liabilities of Hercules, Inc., as of December 31, 2010, and revenues and expenses for the year ended on that date follow. Land Note payable Accounts payable Rent expense Cash Common stock Furniture Interest expense $98,000 Property tax expense 185,000 Accounts receivable 19,000 Advertising expense 23,000 Building 10,000 Salary expense 40,000 Salary payable 20,000 Service revenue 9,000 Supplies $4,000 12,000 13,000 150,000 63,000 1,000 220,000 3,000 Beginning retained earnings were $10,000 and dividends totaled $70,000 for the year. Required: 1. Prepare the income statement of Hercules, Inc., for the year ended December 31, 2010. 2. Prepare Hercules' statement of retained earnings for the year. 3. Prepare Hercules' balance sheet at December 31, 2010. 4. Analyze Hercules's Inc., by answering these questions: a. Was Hercules profitable during 2010? By how much? b. Did retained earning increase or decrease? By how much? Why? c. Who owns more of Hercules' assets, creditors or the Hercules stockholders