Branson Electronics Company is a small, publicly traded company preparing its first quarter interim report to be mailed to shareholders. The following information for the quarter has been compiled: 

Fixed operating expenses include payments of $50,000 to an advertising firm to promote Branson through various media throughout the year. The income tax rate for Branson’s level of operations in the first quarter is 20%, but management estimates the effective rate for the entire year will be 25%. 

Required: 

Prepare the income statement to be included in Branson’s first quarter interim report.

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Sales revenue $180,000 Cost of goods sold 35,000 Operating expenses: Fixed $59,000 Variable 48,000 107,000