The following income statement and balance sheets for Virtual Gaming Systems are provided VIRTUAL GAMING SYSTEMS Income Statement For the year ended December 31, 2018 Net sales Cost of goods sold S3,066,000 1,956,000 Gross profit 1,110,000 Expenses Operating expenses Depreciation expense Loss on sale of land Interest expense Income tax expense $864,000 30,000 8,600 18,000 54,000 Total expenses 974,600 Net income $ 135,400 VIRTUAL GAMING SYSTEMS Balance Sheets December 31 2018 2017 Assets Current assets: Cash Accounts receivable Inventory Prepaid rent $192,000 87,000 111,000 12,600 $150,000 66,000 141,000 6,720 Long-term assets Investment in bonds Land Equipment Less: Accumulated depreciation 111,000 216,000 276,000 (78,000) 246,000 216,000 (48,000) Total assets $927,600 $777,720 Liabilities and Stockholders' Equity Current liabilities Accounts payable Interest payable Income tax payable $ 72,000 7,200 18,000 $ 87,000 3,600 14,600 Long-term liabilities Notes payable 291,000 231,000 Stockholders' equity Common stock Retained earnings 306,000 233,400 306,000 135,520 Total liabilities and stockholders' equity $927,600 $777,720