Question 2 [5 points] The following financial statements are for Ludwig Inc. Ludwig Inc. Income Statement 400 345,600 000 28 258 600 For Years Ended December 31, 2014, 2013, and 2012 Sales Cost of goods sold Gross profit from sales Operating expenses Operating income Interest expense Income before taxes Income taxes Net income 2014 2013 2012 1,143,200 1,288,400 1,138,100 538,600 614,200 593,400 604.600 674,200 544,700 258,600 243,500 271,900 346,000 430,700 Cash Short-term investments Accounts receivable, net Merchandise inventory. Prepaid expenses Notes receivable, due in 2017 Property, plant and equipment, net Ludwig Inc. Balance Sheet December 31, 2014, 2013, and 2012 Assets 2014 2013 2012 000C/ 000 98 73,400 62.700 82,000 81,000 26,100 24,800 23,000 16,600 15,800 13,400 272,800 3,000 3,100 2,900 400 500 17,500 16,500 14.000 430 300 99.400 330,900 272,300 91.100 181.200 258,000 283.000 342.000 Total assets 480.200 498,600 539,000 Liabilities and Equity Accounts payable 33.200 35.600 42.100 Salaries payable 14,100 17 200 15.800 Income taxes payable 43. 100 40.400 36,350 Long-term note payable secured by mortgage on plant assets Share capital 139,000 121,000 119.000 130.000 130.000 150.000 Retained earnings 120.800 154 400 175.750 Total liabilities and equity! 480.200 498.600 539.000