St. Nicholas Tailors rents out a single Santa Claus costume for the months of November and December each year. Its transactions are as follows:

(1) The company commences business on January 1, 1979.

(2) June 1, 1979. One Santa Claus costume is purchased for \(\$ 100\). The costume will last for 10 annual rental periods and is depreciated on a straight-line basis. The costume has a zero estimated salvage value. The company takes a full year of depreciation in the first year.

(3) The costume is rented for the months of November and December 1979 for \(\$ 70\), total.

(4) January 2, 1980. Cleaning costs of \(\$ 5\) are incurred for the costume, which has been returned to St. Nicholas Tailors.

(5) The costume is stored for the months of January through October 1980 at a cost of \(\$ 2\) per month.

(6) The costume is rented for the months of November and December 1980 for \(\$ 70\), total.

(7) The books are closed annually on December 31. Income taxes are to be paid at the rate of 20 percent of the first \(\$ 5\) of taxable income and 40 percent of the rest.

Income statements for the years 1979 and 1980 are shown below.

a Prepare interim quarterly reports for March 31, June 30, September 30, and December \(31,1979\).
b Prepare interim quarterly reports for March 31, June 30, September 30, and December 31,1980

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St. Nicholas Tailors Income Statements for the Years 1979 and 1980 Revenues Expenses: Storage Costs Depreciation Cleaning Costs Income Taxes. Total Expenses Net Income. 1979 1980 $70 $70 $ 0 $20 10 10 0 5 23 13 $33 $48 S37 $22