McGuire Corporation began operations in 2018. The company purchases computer equipment from manufacturers and then sells to retail stores. During 2018, the bookkeeper used a check register to record all cash receipts and cash disbursements. No other journals were used. The following is a recap of the cash receipts and disbursements made during the year.

Cash receipts:
Sale of common stock $ 50,000
Collections from customers 320,000
Borrowed from local bank on April 1, note signed requiring
principal and interest at 12% to be paid on March 31, 2019 40,000
Total cash receipts $ 410,000
Cash disbursements:
Purchase of merchandise $ 220,000
Payment of salaries and wages 80,000
Purchase of office equipment 30,000
Payment of rent on building 14,000
Miscellaneous expenses 10,000
Total cash disbursements $ 354,000

You are called in to prepare financial statements at December 31, 2018. The following additional information was provided to you:

Customers owed the company $22,000 at year-end.

At year-end, $30,000 was still due to suppliers of merchandise purchased on credit.

At year-end, merchandise inventory costing $50,000 still remained on hand.

Salaries and wages owed to employees at year-end amounted to $5,000.

On December 1, $3,000 in rent was paid to the owner of the building used by McGuire. This represented rent for the months of December through February.

The office equipment, which has a 10-year life and no salvage value, was purchased on January 1, 2018. Straight-line depreciation is used.

Required:

Prepare the income statement for 2018 and a balance sheet as of December 31, 2018.