Below are the transactions and adjustments that occurred during the first year of operations at Kissick Co

Issued 191,000 shares of $5-par-value common stock for $955,000 in cash.

Borrowed $510,000 from Oglesby National Bank and signed a 11% note due in three years.

Incurred and paid $400,000 in salaries for the year.

Purchased $670,000 of merchandise inventory on account during the year.

Sold inventory costing $580,000 for a total of $920,000, all on credit.

Paid rent of $330,000 on the sales facilities during the first 11 months of the year.

Purchased $180,000 of store equipment, paying $53,000 in cash and agreeing to pay the difference within 90 days.

Paid the entire $127,000 owed for store equipment and $610,000 of the amount due to suppliers for credit purchases previously recorded.

Incurred and paid utilities expense of $36,000 during the year.

Collected $845,000 in cash from customers during the year for credit sales previously recorded.

At year-end, accrued $56,100 of interest on the note due to Oglesby National Bank.

At year-end, accrued $30,000 of past-due December rent on the sales facilities.

Required:

a. Prepare an income statement (ignoring income taxes) for Kissick Co.'s first year of operations and a balance sheet as of the end of the year. (Hint: You may find it helpful to prepare T-accounts for each account affected by the transactions.)

(Amounts to be deducted and net loss should be indicated with minus sign.)

KISSICK CO.
Income Statement

KISSICK CO.
Balance Sheet
Assets:
Total current assets
Total assets
Liabilities:
Total current liabilities
Total liabilities
Stockholders' Equity:
Total Stockholders' equity
Total liabilities and stockholders' equity