Refer to E3-14.

Data from in E3-14

J. Kamas and G. Charrier have been operating a catering business for several years. In March, the partners plan to expand by opening a retail sales shop. They have decided to form the business as a corporation called Traveling Gourmet, Inc. The following transactions occurred in March:
a. Received $80,000 cash from each of the two shareholders to form the corporation, in addition to $2,000 in accounts receivable, $5,300 in equipment, a van (equipment) appraised at a fair value of $13,000, and $1,200 in supplies. Gave the two owners each 500 shares of common stock with a par value of $1 per share.
b. Purchased a vacant store for sale in a good location for $360,000, making a $72,000 cash down payment and signing a 10-year mortgage note from a local bank for the rest.
c. Borrowed $50,000 from the local bank on a 10 percent, one-year note.
d. Purchased food and paper supplies costing $ 10,200 in March; paid cash.
e. Catered four parties in March for $4,200; $1,600 was billed and the rest was received in cash.
f. Sold food at the retail store for $16,900 cash.
g. Used food and paper supplies costing $10,830.
h. Received a $420 telephone bill for March to be paid in April.
i. Paid $363 in gas for the van in March.
j. Paid $6,280 in wages to employees who worked in March.
k. Paid a $300 dividend from the corporation to each owner.
l. Purchased $50,000 of equipment (refrigerated display cases, cabinets, tables, and chairs) and renovated and decorated the new store for $20,000 (added to the cost of the building); paid cash.

Required:
Use the balances and activity in the completed T-accounts in E3-14 to respond to the following:
1. Prepare an unadjusted classified income statement in good form for the month of March.
2. Identify operating (O), investing (I), and financing (F) activities affecting cash flows. Include the direction and amount of the effect. If there is no effect on cash flows, use NE for both the effect and the amount.
3. What do you think about the success of this company based on the results of the first month of operations?