Presented below are selected ledger accounts of Metro Inc. at December 31, 20x1.Cash185,000Prepaid insurance 24,000Merchandise inventory, 1/1/20X1535,000Advertising expense54,000Sales4,275,000Prepaid income tax93,000Advances from customers117,000Depreciation of sales equipment36,000Purchases2,786,000Telephone sales17,000Purchase discounts27,000Unearned rent8,000Sales salaries284,000Rental revenue240,000Sales returns79,000Interest expense176,000Transportation-in72,000Common stock ($10 par)900,000Sales equipment135,500Additional paid-in capital250,000Accounts receivable142,500Retained earnings166,000Metros tax rate on all items is 34%. A physical inventory indicates that the ending inventory is $686,000. A pretax $5,000 loss was recognized on the sale of Division Y (a major component of the company). This division had earned a pretax operating income of $2,500 in 20x1. During 20x1, 90,000 common shares were outstanding.