Help me figure out this question,especially by explaining where the intrest rate is deducted.

1.Financial Statements: Develop an Income Statement for 20XX, Cash Flow Statement for 20XX, and Balance Sheet as of the end of 20XX based on the data provided below for year 20XX. All sales are collected when the sale is made and all expenses are paid when the expense is incurred. Explain the purpose of each financial statement.a.Income Statement Data for 20XX:Units produced and sold = 420 Sales ($80 per unit selling price) = $33600Cost of goods sold ($30 per unit, all variable costs) = $12600Labor = $0 (Mr. and Mr. Lee were the only ones working and did not pay themselves)Advertising fees =$2000Bank fees = $150Phone/internet = $1200Shipping ($3 per unit) = $1260Utilities = $900Office supplies = $800Interest expense on note payable = $350Depreciation expense (straight line) = $800Income tax rate = 26%