Swing It, Inc., was started several years ago by two tennis instructors. The company's comparative balance sheets and income statement follow, along with additional information. Current Previous Year Year Balance Sheet at December 31 Cash Accounts Receivable Equipment Accumulated Depreciation-Equipment 3,980 1,690 4,700 $ 6,040 870 5,170 (1,440(1,220) $10,640 9,150 Accounts Payable Salaries and Wages Payable Note Payable (long-term) Common Stock Retained Earnings $ 630 1,100 750 500 4,700 3,2802,100 530 1,500 4,700 $10,640 9,150 Income Statement Service Revenue Salaries and Wages Expense Depreciation Expense ncome Tax Expense $40,100 37,600 220 1,100 Net Income $1,180 Additional Data a. Bought new tennis equipment for cash, $470 b. Borrowed $1,000 cash from the bank during the year. c. Accounts Payable includes only purchases of services made on credit for operating purposes. Because there are no liability accounts relating to income tax, assume that this expense was fully paid in cash