The University Book Store sells books and other supplies to students in a state where the sales tax rate is 7 percent. The University Book Store engaged in the following transactions for 2008. Sales tax of 7 percent is collected on all sales.

1. Book sales, not including sales tax, for 2008 amounted to \($275,000\) cash.

2. Cash sales of miscellaneous items in 2008 were \($150,000\), not including tax.

3. Cost of goods sold amounted to \($210,000\) for the year.

4. Paid $ 130,000 in operating expenses for the year.

5. Paid the sales tax collected to the state agency.

Required:

a. What is the total amount of sales tax the University Book Store collected and paid for the year?

b. What is the University Book Store’s net income for the year?