Based on the following information prepare a classified balance sheet and an income statement for the China Tea Company.
| China Tea Company | ||
| Trial Balance December 31, 201X | ||
| Debit | Credit | |
| Cash | 10,500 | |
| Accounts receivable | 150,000 | |
| Prepaid rent | 5,000 | |
| Inventory | 25,000 | |
| Equipment | 300,000 | |
| Accumulated depreciation equipment | 125,000 | |
| Accounts payable | 30,000 | |
| Notes payable due in 3 months | 30,000 | |
| Salaries payable | 4,000 | |
| Interest payable | 1,000 | |
| Capital stock | 200,000 | |
| Retained earnings | 50,000 | |
| Sales revenue | 400,000 | |
| Cost of goods sold | 180,000 | |
| Salaries expense | 120,000 | |
| Rent expense | 15,000 | |
| Depreciation expense | 30,000 | |
| Interest expense | 2,000 | |
| Advertising expense | 2,500 | |
| Totals | 840,000 | 840,000 |