The following information is taken from the $2025$ annual report of snertaan, inc. Sheridan's December $31,2025,$ balance sheet is as follows.

$\backslash$table$[[\backslash$table$[[$Sheridan$,$ Inc.$],[$Balance Sheet$],[$December $31,2025]],],[$Assets$],[$Cash$,$$$490$

Note X: Long Term Debt:

On January $1,2024,$ Sheridan issued bonds with face value of $$1,300$ and a coupon rate equal to $10\%.$ The bonds were issueld $12\%$ and mature on January $1,2029.$

Additional information concerning $2026$ is as follows.

Sales were $$3,700,$ all for cash.

Purchases were $$2,200,$ all paid in cash.

Salaries were $$640,$ all paid in cash.

Property, plant, and equipment was originally purchased for $$2,200$ and is depreciated straight$-$line over a $25-$year life with no salvage value.

Ending inventory was $$2,000.$

Cash dividends of $$100$ were declared and paid by Sheridan.

Ignore taxes.

The market rate of interest on bonds of similar risk was $12\%$ during all of $2026.$

Interest on the bonds is paid semiannually each June $30$ and December $31.$

$($a$1)$

Prepare an income statement for the year ending December $31,2026.$ Assume semiannual compounding of the bond interest.