Problem #1. You have been assigned the problem of creating financial statements for a company for the next year. You have the following information. The company was started on December 31, 2012. Balance Sheet as of December 31, 2012 Assets Cash $2,000 + Inventory $20,000 Buildings and Equipment $10,000 Less Accumulated Depreciation $0 + Net Buildings and Equipment $10,000 Total Assets $32,000 Liabilities Bank Loan $10,000 Owners Equity Common Stock Retained Earnings Total Liabilities and Owners Equity $22,000 $0 $32,000 You have created the following income statement for the year ending December 31, 2013. Sales $80,000 - Cost of Goods Sold $20,000 - Administrative Expenses $5,000 - Labor $30,000 - Depreciation $1,000 =Earnings Before Interest and Tax $24,000 - Interest $1,000 =Earnings before Taxes $23,000 - Taxes @ 20 percent $4,600 =Net Income $18,400 Other information: All sales are cash sales All expenses except depreciation are cash expenses No principal payments were paid on the bank loan. The company paid $5,000 in dividends from cash. Inventory Levels do not change during the year. Your job is to create a retained earnings statement for the year ending December 31, 2013, and a balance sheet for December 31, 2013. Note: For this problem, the cash balance for the December 31, 2013 balance sheet is $16,400