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Item 2

Item 2 2.5 points

All of the accounts of the Grass is Greener Company have been adjusted as of December 31, 2018, with the exception of income taxes incurred but not yet recorded. Those account balances appear below. All have normal balances. The estimated income tax rate for the company is 40%.

Cash	$	369,340
Accounts Receivable		789,950
Interest Receivable		5,200
Prepaid Insurance		7,700
Prepaid Rent		13,000
Supplies		225,900
Equipment		690,500
Accumulated Depreciation		143,300
Accounts Payable		299,700
Deferred Revenue		92,600
Income Tax Payable		0
Salaries and Wages Payable		28,800
Notes Payable (long-term)		374,040
LongTerm Debt		247,600
Common Stock		402,200
Retained Earnings		221,800
Dividends		23,600
Service Revenue		958,000
Interest Revenue		132,100
Supplies Expense		354,200
Repairs and Maintenance Expense		262,300
Depreciation Expense		61,350
Rent Expense		32,300
Income Tax Expense		Unknown

Required:

1. Calculate the income before income tax.
2. Calculate the income tax expense.
3. Calculate the net income.