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.)

a.	Issued 194,000 shares of $5-par-value common stock for $970,000 in cash.
b.	Borrowed $520,000 from Oglesby National Bank and signed a 10% note due in two years.
c.	Incurred and paid $420,000 in salaries for the year.
d.	Purchased $640,000 of merchandise inventory on account during the year.
e.	Sold inventory costing $580,000 for a total of $910,000, all on credit.
f.	Paid rent of $220,000 on the sales facilities during the first 11 months of the year.
g.	Purchased $190,000 of store equipment, paying $54,000 in cash and agreeing to pay the difference within 90 days.
h.	Paid the entire $136,000 owed for store equipment, and $600,000 of the amount due to suppliers for credit purchases previously recorded.
i.	Incurred and paid utilities expense of $37,000 during the year.
j.	Collected $845,000 in cash from customers during the year for credit sales previously recorded.
k.	At year-end, accrued $52,000 of interest on the note due to Oglesby National Bank.
l.	At year-end, accrued $20,000 of past-due December rent on the sales facilities.

\f\fKISSICK COMPANY INCOME STATEMENT $ Sales notes payable Gross profit salaries payable Merchandise inventory cost of goods sold rent payable income from operations equipment utilities expense Sales Net loss. 970000 -20000 950000 420000 -270000 1100000 240000 1340000 190000 37000 970000 -597000 KISSICK COMPANY BALANCE SHEET Assets Current Assets cash merchandise inventory accounts receivable TOTAL CURRENT ASSETS Fixed Assets SUSPENSE ACCOUNT store equipment TOTAL ASSETS LIABILITIES current liabilities accounts payables Accruals a)notes b)sales facility TOTAL CURRENT LIABILITIES Long term liability TOTAL LIABILITIES OWNER`S EQUITY Common stock Net loss Total Owner`s Equity TOTAL LIABILITIES AND OWNERS EQUIYT (44,000) (270,000) 65,000 (249,000) 152,000 190,000 93,000 (96,000) 52,000 20,000 (24,000) 520,000 496,000 194,000 (597,000) (403,000) 93,000 Kissick Company financial statements. The journal entries a) Date 31- Dec- 20xx Description Cash Common stock (To record shares issued at par $. 5) Dr 194000 Cr 194000 b) Date 31- Dec- 20xx Description Cash Dr Cr 468000 Interest expense 10% 52000 Note payable 520000 c) Date 31- Dec- 20xx Description Salaries expense Cash (Being a record of salary paid in the year.) Dr 420000 Description Inventory merchandise Accounts payable (To record inventory purchases on credit) Dr 640000 Cr 420000 d) Date 31- Dec- 20xx Cr 640000 e) Date 31- Dec- 20xx Description Accounts receivable Inventory (to record sale of inventory on credit) Dr 910000 Cr 910000 f) Date 31- Dec- 20xx Description Dr Rent expense 220000 Cash (Record of rent paid for the sales facilities) Cr Description Store equipment Cash Cr 220000 g) Date 31- Dec- 20xx Dr 190000 54000 136000 Accounts payable (Being records of store equipment purchased.) h) Date 31- Dec- 20xx Description Accounts payable Cash (to record a payment for store equipment and inventory previously purchased on credit) Dr 736000 Cr 736000 i) 31- Dec- 20xx 37000 Utility expenses Cash (to record cash payment for utilities expenses for the year) 37000 j) 31- Dec- 20xx 845000 Cash Accounts receivable 845000 (To record cash proceeds from credit sale of inventory previously recorded.) k) 31- Dec- 20xx 52000 Interest expense Accrued note 52000 (to record accruals on note due to Olgesby National Bank) l) 31- Dec- 20xx Rent Accrued sales facilities (To record rent accruals during the period end) 20000 20000 The T- accounts cash cash note payable 194,000 common stock 520,000 accounts receivable 845,000 bal c/d 44,000 TOTAL 1,603,000 bal b/d 44,000 salaries expense 420,000 rent store equipment accounts payable utility expenses 220,000 TOTAL 1,603,000 190,000 736,000 37,000 common stock bal c/d 194,000 cash 194,000 TOTAL 194,000 TOTAL 194,000 bal b/d 194,000 bal c/d 104,000 interest expense note payable accrued note 52,000 52,000 TOTAL bal b/d 104,000 104,000 TOTAL 104,000 salaries expense cash 420,000 bal c/d 420,000 TOTAL bal b/d 420,000 420,000 TOTAL 420,000 inventory 640,000 bal c/d 96,000 TOTAL 736,000 accounts payable cash TOTAL bal b/d 736,000 736,000 96,000 rent expense cash 220,000 accrued sales facilities 20,000 bal c/d 240,000 TOTAL 240,000 bal b/d 240,000 TOTAL 240,000 Utilities expense cash 37,000 bal c/d 37,000 TOTAL bal b/d 37,000 TOTAL 37,000 Accrued sales facility bal c/d 20,000 Rent 20,000 TOTAL bal b/d 20,000 20,000 TOTAL 20,000 Note payable bal c/d 520,000 cash Interest expense 468,000 52,000 TOTAL 520,000 bal b/d TOTAL 520,000 Bal b/d 520,000 Inventory Accounts payable 640,000 bal c/d 270,000 TOTAL 910,000 Accounts receivable 910,000 TOTAL 910,000 bal b/d 270,000 Accounts Receivable Inventory TOTAL bal b/d 910,000 910,000 65,000 Cash 845,000 bal c/d 65,000 TOTAL 910,000 Store Equipment cash 190,000 bal c/d 190,000 TOTAL 190,000 TOTAL 190,000 bal b/d 190,000 Accrued notes bal c/d 52,000 interest expense 52,000 TOTAL 52,000 TOTAL 52,000 bal b/d 52,000