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

1. Issued 192,000 shares of $4-par-value common stock for $768,000 in cash.

2. Borrowed $520,000 from Oglesby National Bank and signed a 11% note due in three years.

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

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

5. Sold inventory costing $570,000 for a total of $910,000, all on credit.

6. Paid rent of $220,000 on the sales facilities during the first 11 months of the year.

7. Purchased $170,000 of store equipment, paying $50,000 in cash and agreeing to pay the difference within 90 days.

8. Paid the entire $120,000 owed for store equipment and $610,000 of the amount due to suppliers for credit purchases previously recorded.

9. Incurred and paid utilities expense of $34,000 during the year.

10. Collected $825,000 in cash from customers during the year for credit sales previously recorded.

11. At year-end, accrued $57,200 of interest on the note due to Oglesby National Bank.

12. At year-end, accrued $20,000 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.)