Accounts payable ...................................................................................................

$12,750

Accounts receivable .............................................................................................

2,600

Accumulated depreciation; office equipment ................................................

12,000

Additional paid-in capital (common stock) ......................................................

7,000

Bonds payable (due December 31, 2012) .........................................................

22,500

Cash .....................................................................................................................

15,200

Common stock (1,800 shares, $10 par value) ...................................................

18,000

Cost of goods sold ...................................................................................................

100,575

Deferred income taxes ..........................................................................................

5,750

Depreciation expense; office equipment ............................................................

2,750

Dividends declared ................................................................................................

5,000

Income tax expense ................................................................................................

8,190

Insurance expense ...................................................................................................

900

Land ......................................................................................................................

37,500

Merchandise inventory .......................................................................................

17,500

Notes payable (due December 31, 2008) ............................................................

2,500

Office equipment ...................................................................................................

41,000

Office supplies .........................................................................................................

900

Office supplies expense .......................................................................................

520

Preferred stock (250 shares, $20 par value) ......................................................

6,000

Premium on bonds payable ....................................................................................

1,750

Prepaid rent ..........................................................................................................

1,800

Rent expense ........................................................................................................

6,100

Retained earnings (January 2007) ........................................................................

21,050

Salaries expense .....................................................................................................

68,095

Sales ......................................................................................................................

226,000

Sales returns and allowances .................................................................................

2,500

Sales taxes payable ...............................................................................................

8,200

Treasury stock (200 common shares at cost) ......................................................

2,250

Utilities expense .....................................................................................................

4,120