On December 31, 2002, analysis of the Rollins Sporting Goods' operations for 2002 revealed the following.

(a) Total cash collections from customers, \($107,770\).

(b) December 31, 2001, inventor}- balance, \($10,020\).

(c) Total cash payments, \($96,350\).

(d) Accounts receivable, December 31. 2001. \($20,350\).

(e) Accounts payable, December 31, 2001, \($9,870\).

(f) Accounts receivable, December 3 1 , 2002, \($15,780\).

(g) Accounts payable, December 31, 2002, \($5,175\).

(h) General and administrative expenses total 25% of sales. This amount includes the depreciation on store and equipment,

(i) Selling expenses of \($11,661\) total 20% of gross profit,

(j) No general and administrative or selling expense liabilities existed at December 31,2002.

(k) Wages and salaries payable at December 31, 2001, \($3,750\).

(l) Depreciation expense on store and equipment total 12.0% of general and administrative expenses.

(m) Shares of stock issued and outstanding, 6,000.

(n) The income tax rate is 40%.

Instructions:

Prepare a multiple-step income statement for the year ended December 31. 2002.