Income statement preparation Cathy Chen, a self$-$employed certified public accountant $($CPA$),$ just completed her first full year in business. During the year, she charged her clients $$365,000$ for her accounting services. She had two employees, a bookkeeper and a clerical assistant. In addition to her monthly salary of $$7,950,$ Ms$.$ Chen paid annual salaries of $$48,000$ and $$36,300$ to the bookkeeper and the clerical assistant, respectively. Employment taxes and benefit costs for Ms$.$ Chen and her employees totaled $$35,000$ for the year. Expenses for office supplies, including postage, totaled $$11,000$ for the year. In addition, Ms$.$ Chen sper $$16,700$ during the year on tax$-$deductible travel and entertainment associated with client visits and new business development. Lease payments for the office space rented $($a tax$-$deductible expense$)$ were $$2,670$ per month. Depreciation expense on the office furniture and fixtures was $$15,800$ for the year. During the yea Ms$.$ Chen paid interest of $$14,500$ on the $$125,000$ borrowed to start the business. Her average tax rate for the year was $30\%.$

a$.$ Prepare an income statement for Cathy's business for the year.

b$.$ Evaluate her financial performance for the year.

a$.$ Prepare an income statement for Cathy's business for the year.

Complete the fragment of the income statement for Cathy Chen below: $($Select the correct account from the drop$-$down menu and round to the nearest dollar.$)$ Cathy Chen, CPA

Income Statement

for the Year Ended December $31,2021$

Complete the fragment of the income statement for Cathy Chen below: $($Select the correct account from the drop$-$down menu and round to the nearest dollar.$)$ Less: Operating expenses

$