The December 31, 2018, adjusted trial balance for the Blueboy Cheese Corporation is presented below. Account Title Debits Credits Cash 68,500 Accounts receivable 250,000 Prepaid rent 5,000 Inventory 35,000 Office equipment 450,000 Accumulated depreciationoffice equipment 190,000 Accounts payable 40,000 Note payable (due in six months) 15,000 Salaries payable 6,000 Interest payable 500 Common stock 400,000 Retained earnings 70,000 Sales revenue 600,000 Cost of goods sold 360,000 Salaries expense 90,000 Rent expense 15,000 Depreciation expense 45,000 Interest expense 1,000 Advertising expense 2,000 Totals 1,321,500 1,321,500

Required: 1-a. Prepare an income statement for the year ended December 31, 2018.

1-b. Prepare a classified balance sheet as of December 31, 2018.

2. Prepare the necessary closing entries at December 31, 2018.