Required information Problem 12-6B Use ratios to analyze risk and profitability (L012-3, 12-4) [The following information applies to the questions displayed below.] Income statement and balance sheet data for The Athletic Attic are provided below. THE ATHLETIC ATTIC Income Statements For the years ended December 31 2022 2021 Net sales $12,920,000 $11,500,000 Cost of goods sold 8,420,000 7,200,000 Gross profit 4,500,000 4,300,000 Expenses: Operating expenses 1,780,000 1,730,000 Depreciation expense 200,000 200,000 Interest expense 58,000 58,000 Income tax expense 616,000 530,000 Total expenses 2,654,000 2,518,000 Net income $ 1,846,000 $ 1,782,000 Income tax expense Total expenses Net income 616,000 2,654,000 $ 1,846,000 530,000 2,518,000 $ 1,782,000 2021 2020 $ 173,000 758,000 1,373,000 118,000 240,000 778,000 1,043,000 93,000 THE ATHLETIC ATTIC Balance Sheets December 31 2022 Assets Current assets: Cash $ 243,000 Accounts receivable 1,008,000 Inventory 1,743,000 Supplies 148,000 Long-term assets: Equipment 1,820,000 Less: Accumulated depreciation (780,000 Total assets $4,182,000 Liabilities and Stockholders' Equity Current liabilities: Accounts payable $ 227,200 Interest payable 5,800 Income tax payable 58,000 Long-term liabilities: Notes payable 680,000 Stockholders' equity! Common stock 780,000 Retained earnings 2,431,000 Total liabilities and stockholders' equity $4,182,000 1,820,000 (580,000) $3,662,000 1,820,000 (380,000) $3,594,000 $ 160,000 0 53,000 I 680,000 $ 151,200 5,800 48,000 680,000 780,000 1,989,000 $3,662,000 780,000 1,929,000 $3,594,000