Melody Lane Music Company was started by John Ross early in 2021. Initial capital was acquired by issuing shares of common stock to various investors and by obtaining a bank loan. The company operates a retail store that sells records, tapes, and compact discs. Business was so good during the first year of operations that John is considering opening a second store on the other side of town. The funds necessary for expansion will come from a new bank loan. In order to approve the loan, the bank requires financial statements. John asks for your help in preparing the balance sheet and presents you with the following information for the year ending December 31, 2021: a. Cash receipts consisted of the following: From customers From issue of common stock $412,950 135,000 From bank loan 114,000 b. Cash disbursements were as follows: Purchase of inventory Rent Salaries Utilities Insurance Purchase of equipment $307,000 30,000 37,000 12,000 10,000 47,000 c. The bank loan was made on March 31, 2021. A note was signed requiring payment of interest and principal on March 31, 2022. The interest rate is 10%. d. The equipment was purchased on January 3, 2021, and has an estimated useful life of 5 years with no anticipated salvage value. Depreciation per year is $9,400. e. Inventory on hand at the end of the year cost $107,000. f. Amounts owed at December 31, 2021, were as follows: