During Year 1, Hardy Merchandising Company purchased $40,000 of inventory on account. Hardy sold inventory on account that cost $24,500 for $38,000. Cash payments on accounts payable were $22,000. There was $26,000 cash collected from accounts receivable. Hardy also paid $5,100 cash for operating expenses. Assume that Hardy started the accounting period with $20,000 in both cash and common stock.