$3-7.($Working with an income statement and balance sheet$)$ Prepare a balance sheet and income statement for Kronlokken Company from the following scrambled list of items.

Prepare a common$-$sized income statement and a common$-$sized balance sheet. Interpret your findings.

Depreciation expense $$66,000$

Cash $225,000$

Long$-$term debt $334,000$

Sales $573,000$

Accounts payable $102,000$

General and administrative expense $79,000$

Buildings and equipment $895,000$

Notes payable $75,000$

Accounts receivable $153,000$

Interest expense $4,750$

Accrued expenses $7,900$

Common stock $289,000$

Cost of goods sold $297,000$

Inventory $99,300$

Taxes $50,500$

Accumulated depreciation $263,000$

Prepaid expenses $14,500$

Taxes payable $53,000$

Retained earnings $262,900$