Atkinson Corporation is a merchandising company that is preparing a master budget for the third quarter of the calendar year. The company$$s balance sheet as of June $30$th is shown below:

Atkinson Corporation

Balance Sheet

June $30$

Assets

Cash $ $95,000$

Accounts receivable $142,000$

Inventory $54,000$

Plant and equipment, net of depreciation $225,000$

Total assets $ $516,000$

Liabilities and Stockholders$$ Equity

Accounts payable $ $86,000$

Common stock $332,000$

Retained earnings $98,000$

Total liabilities and stockholders$$ equity $ $516,000$

Atkinson$$s managers have made the following additional assumptions and estimates:

Estimated unit sales for July, August, September, and October will be $36,000,38,000,37,000,$ and $39,000,$ respectively. Each unit sells for $$10.$ As a result, estimated sales dollars for July, August, September, and October will be $$360,000,$ $$380,000,$ $$370,000,$ and $$390,000,$ respectively.

All sales are on credit and all credit sales are collected. Each month$$s credit sales are collected $35\%$ in the month of sale and $65\%$ in the month following the sale. All of the accounts receivable at June $30$ will be collected in July.

Each month$$s ending inventory must equal $25\%$ of the next month$$s sales units. The company pays $$6\mathrm{.}00$ per unit to purchase its merchandise. The company pays for $40\%$ of its merchandise purchases in the month of the purchase and the remaining $60\%$ in the month following the purchase. All of the accounts payable at June $30$ will be paid in July.

Monthly selling and administrative expenses are always $$48,000.$ Each month $$7,000$ of this total amount is depreciation expense and the remaining $$41,000$ relates to expenses that are paid in the month they are incurred.

The company does not plan to borrow money or pay or declare dividends during the quarter ended September $30.$ The company does not plan to issue any common stock or repurchase its own stock during the quarter ended September $30.$

Required:

$3.$ Prepare an income statement that computes net operating income for the quarter ended September $30.$