The comparative financial statements prepared at December 31, 2010, for Pinnacle Plus showed the following summarized data:

	2010			2009
Income Statement
Sales revenue*	$	110,000		$	99,000
Cost of goods sold		52,000			48,000
Gross profit		58,000			51,000
Operating expenses		36,000			33,000
Interest expense		4,000			4,000
Income before income taxes		18,000			14,000
Income tax expense (30%)		5,400			4,200
Net income	$	12,600		$	9,800
Balance Sheet
Cash	$	49,500		$	18,000
Accounts receivable (net)		37,000			32,000
Inventory		25,000			38,000
Property and equipment (net)		95,000			105,000
Total assets	$	206,500		$	193,000
Accounts payable	$	42,000		$	35,000
Income taxes payable		1,000			500
Note payable, long-term		40,000			40,000
Total liabilities		83,000			75,500
Common stock (par $10)		90,000			90,000
Retained earnings