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Problem $10-26$A $($Algo$)$ Service versus manufacturing companies LO $10-4$

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Vernon Company, began operations on January $1,$ Year $1,$ by issuing common stock for $$36,000$ cash. During Year $1,$ Vernon received $$55,400$ cash from revenue and incurred costs that required $$38,400$ of cash payments.

Problem $10-26$A $($Algo$)$ Part a

Required

Prepare a GAAP$-$based income statement and balance sheet for Vernon Company for Year $1$ under the following scenario:

a$.$ Vernon is a promoter of rock concerts. The $$38,400$ was paid to provide a rock concert that produced the revenue.

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Income Statement

Balance Sheet

Prepare an Income Statement.

$\backslash$table$[[$VERNON COMPANY$],[$Income Statement for Year $1]]$