On January 2, Dan Bailey started the BaileyCompany. In January, Bailey Company did the following things:

(a) It received $5,000 cash from Dan Bailey as its capital.

(b) It borrowed $10,000 from a bank, giving a note therefor.

(c) It purchased $4,000 of inventory for cash.

(d) It sold $2,000 of its inventory for $6,000 to a customer, who paid $3,500 cash and agreed to pay $2,500 within 30 days.

(e) It purchased an auto for $7,000. It paid $2,000 down and gave a note to the automobile dealer for the remaining $5,000.

(f) Bailey withdrew $1,000 cash for her personal use.
(g) Bailey was offered $10,000 for her equity in the business, but she refused the offer.

On a separate piece of paper, prepare a rough draft of a balance sheet for Bailey Company as of the close of business January 31, and an income statement for January.

Total. BAILEY COMPANY Balance Sheet as of Total. BAILEY COMPANY Income Statement for. Income and