Presented here are the financial statements of Carla Vista Company. \begin{tabular}{|c|c|c|} \hline \multicolumn{3}{|c|}{\begin{tabular}{c} Carla Vista Company \\ Comparative Balance Sheets \\ December 31 \end{tabular}} \\ \hline \multirow[b]{2}{*}{ Assets } & 2025 & 2024 \\ \hline & & \\ \hline Cash & $87,500 & $50,000 \\ \hline Accounts receivable & 50,000 & 35,000 \\ \hline Inventory & 70,000 & 50,000 \\ \hline Property, plant, and equipment & 150,000 & 195,000 \\ \hline Accumulated depreciation & (80,000) & (60,000) \\ \hline Total & $277,500 & $270,000 \\ \hline \multicolumn{3}{|c|}{ Liabilities and Stockholders' Equity } \\ \hline Accounts payable & $47,500 & $37,500 \\ \hline Income taxes payable & 17,500 & 20,000 \\ \hline Bonds payable & 42,500 & 82,500 \\ \hline Common stock & 45,000 & 35,000 \\ \hline Retained earnings & 125,000 & 95,000 \\ \hline Total & $277,500 & $270,000 \\ \hline \end{tabular} Carla Vista Company Income Statement For the Year Ended December 31, 2025 \begin{tabular}{|c|c|c|} \hline Sales revenue & & $605,000 \\ \hline Cost of goods sold & & 437,500 \\ \hline Gross profit & & 167,500 \\ \hline Selling expenses & $45,000 & \\ \hline Administrative expenses & 15,000 & 60,000 \\ \hline Income from operations & & 107,500 \\ \hline Interest expense & & 7,500 \\ \hline Income before income taxes & & 100,000 \\ \hline Income tax expense & & 20,000 \\ \hline Net income & & $80,000 \\ \hline \end{tabular} Additional data: 1. Depreciation expense was $43,750. 2. Dividends declared and paid were $50,000. 3. During the year, equipment was sold for $21,250 cash. This equipment originally cost $45,000 and had accumulated depreciation of $23,750 at the time of sale. 4. Bonds were redeemed at their carrying value. 5. Common stock was issued at par for cash. .g. 15,000