• 2. The following selected accounts and their current balances appear in the ledger ofDrapery Land Co. for the fiscal year ended July 31, 2010:Cash $ 161,250 Sales Returns and Allowances $ 69,300Accounts Receivable 363,000 Sales Discounts 65,700Merchandise Inventory 525,000 Cost of Merchandise Sold 2,325,000Office Supplies 16,800 Sales Salaries Expense 519,600Prepaid Insurance 10,200 Advertising Expense 131,400Office Equipment 255,000 Depreciation Expense—Accumulated Depreciation— Store Equipment 19,200Office Equipment 138,400 Miscellaneous Selling Expense 4,800Store Equipment 759,000 Office Salaries Expense 252,450Accumulated Depreciation— Rent Expense 94,050Store Equipment 102,600 Depreciation Expense—Accounts Payable 166,800 Office Equipment 38,100Salaries Payable 7,200 Insurance Expense 11,700Note Payable Office Supplies Expense 3,200(final payment due 2020) 168,000 Miscellaneous Administrative Expense 5500Tanya Xavier, Capital 1,312,250 Tanya Xavier, Drawing 105,000 Interest Expense 15,000Sales 3,855,000Instructions1. Prepare a multiple-step income statement.2. Prepare a statement of owner’s equity.3. Prepare a report form of balance sheet, assuming that the current portion of the note payable is $16,800.