Ginny and Joe Miller opened a small hardware store in $2006,$ using their own cash savings and borrowing a small sum from Ginny's parents. Nothing gave them more pride than owning and operating a locally owned business, even if it was complicated by the constant pressures placed on them by big$-$box retailers. But by $2021,$ business was booming. General Hardware had five locations, and the Millers were considering an even greater expansion in the coming year, perhaps offering their own version of a national franchise model.

The drop$-$off in activity during the first quarter of $2022,$ however, dampened those plans. The quarter turned out to be a time for retrenchment and planning for a sustained period of contraction. The following is a summary of first quarter activity for the year $2022,$ along with the final December $31,2021,$ balance sheet $($see Exhibit $1).$

Product sales totaled $$3$ million $($all customers paid with cash$),$ and the company had paid $$2\mathrm{.}2$ million for that inventory sold.

$$ Inventory purchases totaled $$1\mathrm{.}5$ million during the quarter, all on a credit basis with the company's vendors. The company had repaid its outstanding accounts payable during the quarter in the amount of $$1\mathrm{.}7$ million.

$$ Marketing costs of $$10,000$ had been paid in February, all related to a series of President's Day TV advertisements.

$$ Wages, rents, and other administrative expenses totaled $$373,000.$ All, except the March rent of $$50,000,$ were paid with cash.

$$ The month of March rent payments, totaling $$50,000$ and due on or before March $15,$ had not been paid as of March $31,$

$$ The company paid the balance due for taxes during the first quarter, and the Millers expected to pay any taxes due on their first$-$quarter profit during the second quarter of $2022.$ The corporate tax rate was a flat $25\%.$

Depreciation charges for quarter amounted to $$81,000.$

The company acquired $$200,000$ of fixed assets on the last day of the quarter, March $31,$ financing the entire amount with a new long$-$term note.

Existing long$-$term debt carried an average interest charge of $8\%.$ A first$-$quarter long$-$term debt payment of $$75,000$ had been made on March $30,$ covering both interest and principal for the first quarter of $2022.$

Using the data provided, prepare a balance sheet and income statement for General Hardware for the first quarter of $2022.$