Following are the transactions and adjustments that occurred during the first year of operations at Kissick Company.

Issued $197,000$ shares of $$4-$par$-$value common stock for $$788,000$ in cash.

Borrowed $$540,000$ from Oglesby National Bank and signed a $12\%$ note due in three years.

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

Purchased $$640,000$ of merchandise inventory on account during the year.

Sold inventory costing $$580,000$ for a total of $$910,000,$ all on credit.

Paid rent of $$110,000$ 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 $$127,000$ owed for store equipment and $$590,000$ of the amount due to suppliers for credit purchases previously recorded.

Incurred and paid utilities expense of $$37,000$ during the year.

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

At year$-$end, accrued $$64,800$ of interest on the note due to Oglesby National Bank.

At year$-$end, accrued $$10,000$ of past$-$due December rent on the sales facilities.

Required:

a$.$ Prepare an income statement $($ignoring income taxes$)$ for Kissick Company's first year of operations and a balance sheet as of the end of the year. $($Hint: You may find it helpful to prepare a T$-$account for the Cash account since it is affected by most of the transactions.$)$ Reminder: Increases to expenses should be entered as negative numbers to show the impact on net income. See Exhibit $4\mathrm{.}3.$