TrackMe specializes in manufacturing and selling precision global positioning system (GPS) tracking devices for athletes. Anyone wearing a TrackMe anklet can be located on a number of Internet-based mapping services through a computer or smart phone, all the wearer needs to do is provide a personalized code and visit the TrackMe website. TrackMe devices can be used to simply track your personal statistics (e.g., pace, mileage, elevation gain), or they can be used for safety, such as when running or hiking in isolated locations or late at night. Below are TrackMe's financial statements for 2012. TrackMe adheres to GAAP in recording transactions and creating its financial statements. INCOME STATEMENT (for the period ending December 31) (in thousands) Product revenue Service revenue Total revenue Cost of goods sold Gross income Depreciation expense Wage expense Advertising expense Rent expense Other expenses Total operating expenses Operating income Interest expense Pre-tax income Income tax expense Net income 2012 $624,000 101,244 725,244 370,296 354,948 22,000 107,000 55,000 46,000 23,000 253,000 101,948 2,640 99,308 26,813 $72,495 2011 $509,533 97,028 606,561 301,517 305,044 21,000 106,000 45,000 52,000 26,000 250,000 55,044 2,880 52,164 14,084 38,080 2010 334,695 95,994 430,689 215,089 215,600 20,500 84,000 30,000 41,000 16,000 191,500 24,100 3,120 20,980 5,665 15,315 BALANCE SHEET (as of December 31) (in thousands) Current assets Cash Accounts receivable Inventories Prepaid rent Prepaid advertising Total current assets Equipment, net Total assets Current liabilities Accounts payable Wages payable Unearned revenue Current portion of LT debt Total current liabilities Long-term (LT) debt Total liabilities Owners' equity Common stock Retained earnings Total owners' equity Total liabilities & owners' equity 2012 $102,042 81,302 182,232 18,023 12,824 396,423 91,132 $487,555 $72,435 25,905 15,000 4,000 117,340 40,000 157,340 178,755 151,460 330,215 $487,555 2011 $40,588 93,515 166,082 11,642 10,418 322,245 68,368 $390,613 $55,012 36,111 15,000 4,000 110,123 44,000 154,123 142,000 94,490 236,490 $390,613 The following information is available at the end of fiscal 2013 (all amounts are in thousands): 1. Product revenue for fiscal 2013 totaled $720,000. Sixty percent of the product revenue was paid for with cash, two percent came from unearned revenue, and the rest was sold on account. 2. Service revenue for fiscal 2013 totaled $112,500. Twenty percent of the service revenue was paid for with cash. The remaining service revenue was sold on account. 3. TrackMe collected $434,800 of accounts receivable during the year.