The financial statements for Castile Products, Inc., are given below: Castile Products, Inc. Balance Sheet Assets Current assets: 5 21,000 230,000 390,000 10,000 Prepaid expenses Total current assets Property and equipment, net 851,000 900,000 Total assets $1,551,000 Liabilities and Stockholders' Equity Current liabilities Bonds payable, 1096 S 210,000 330,000 540,000 S 170,000 Total liabilities Stockholders equity: Common stock, $10 par value Retained earnings 841,000 1,011,000 $1,551,000 Total stockholders' equity Total liabilities and equity Castile Products, Inc. Income Statement For the Year Ended December 31 Sales Cost of goods sold $2,800,000 1,612,500 Gross margin Selling and administrative expenses 1,187,500 840,000 Net operating income Interest expense 547,500 33,000 Net income before taxes Income taxes (30%) 514,500 154,350 Net income S 380,150