Portions of the financial statements for Hawkeye Company are provided below.

HAWKEYE COMPANY Selected Accounts from Comparative Balance Sheets December 31, 2018 and 2011 Year 2018 2011 Change Cash $212 $200 $ 12 Accounts receivable 395 421 (26) Inventory 860 850 10 Accounts payable 210 234 (24) Salaries payable 180 188 (8) Interest payable 55 50 5 Income taxes payable 90 104 (14) HAWKEYE COMPANY Income Statement For the Year Ended December 31, 2018 ($ in millions) Sales $900 Cost of goods sold 350 Gross margin 550 Operating expenses: Salaries $232 Depreciation 190 Loss on sale of land 12 Total operating expenses 434 Operating income 116 Other income (expense): Gain on sale of cash equivalents 4 Interest expense (40) Income before tax 80 Income tax expense 40 Net income $ 40