The financial statements for Castile Products, Incorporated, are given below: Castile Products, Incorporated Assets Balance Sheet December 31 Current assets: Cash Accounts receivable, net Merchandise inventory Prepaid expenses Total current assets Property and equipment, net Total assets Liabilities and Stockholders' Equity Liabilities: Current liabilities Bonds payable, 11% Total liabilities Stockholders' equity: Common stock, $5 per value Retained earnings Total stockholders' equity Total liabilities and stockholders' equity Sales Castile Products, Incorporated Income Statement For the Year Ended December 31 Cost of goods sold. Gross margin Selling and administrative expenses. Net operating income Interest expense Net income before taxes Income taxes (30%) Net income 18,000 180,000 350,000 9,000 557,000 830,000 $ 1,387,000 $ 270,000 300,000 570,000 $ 140,000 677,000 817,000 $ 1,387,000 $ 2,140,000 1,210,000 930,000 620,000 310,000 33,000 277,000 83,100 $ 193,900