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Mountain Sports, Inc., is a retailer that has engaged you to assist in the preparation of its financial statements at December 31, 2018. Following are the correct adjusted account balances, in alphabetical order, as of that date. Each balance is the normal balance for that account. (Hint: The normal balance is the same as the debit or credit side that increases the account.)

Accounts payable	$	12,850
Accounts receivable		3,600
Accumulated depreciation: office equipment		12,200
Additional paid-in capital (common stock)		7,800
Bonds payable (due December 31, 2021)		23,200
Cash		14,200
Common stock (2,600 shares, $10 par value)		26,000
Cost of goods sold		108,920
Deferred income taxes		6,050
Depreciation expense: office equipment		2,700
Dividends declared		4,900
Income tax expense		7,840
Insurance expense		860
Land		39,400
Merchandise inventory		20,100
Notes payable (due December 31, 2019)		3,400
Office equipment		42,000
Office supplies		830
Office supplies expense		510
Preferred stock (270 shares, $20 par value)		5,400
Premium on bonds payable		2,150
Prepaid rent		1,320
Rent expense		5,800
Retained earnings (January 2018)		21,950
Salaries expense		87,945
Sales		226,100
Sales returns and allowances		1,900
Sales taxes payable		3,200
Treasury stock (300 common shares at cost)		3,375
Utilities expense		4,100

a. Prepare an income statement for the year ended December 31, 2018.

b. Prepare a statement of retained earnings for the year ending December 31, 2018.

c. Prepare a statement of financial position as of December 31, 2018. (Amounts to be deducted should be indicated by minus sign.)