The following trial balance was prepared for Village Cycle Sales and Service on December 31, Year 1:

Account Title
Cash .................................................................................$46,200
Accounts Receivable ........................................................21,300
Allowance for Doubtful Accounts ...................................1,350
Inventory ..........................................................................85,600
Accounts Payable ...........................................................28,000
Common Stock ...............................................................80,000
Retained Earnings ..........................................................43,750

Village Cycle had the following transactions in Year 2:
1. Purchased merchandise on account for $260,000.
2. Sold merchandise that cost $243,000 on account for $340,000.
3. Performed $80,000 of services for cash.
4. Sold merchandise for $60,000 to credit card customers. The merchandise cost $41,250. The credit card company charges a 5 percent fee.
5. Collected $348,000 cash from accounts receivable.
6. Paid $265,000 cash on accounts payable.
7. Paid $115,000 cash for selling and administrative expenses.
8. Collected cash for the full amount due from the credit card company (see item 4).
9. Loaned $50,000 to Lee Supply. The note had a 9 percent interest rate and a one-year term to maturity.
10. Wrote off $830 of accounts as uncollectible.
11. Made the following adjusting entries:
(a) Recorded three months’ interest on the note at December 31, Year 2 (see item 9).
(b) Estimated uncollectible accounts expense to be .5 percent of sales on account.

Required
a. Organize the transaction data in accounts under an accounting equation.
b. Prepare an income statement, a statement of changes in stockholders’ equity, a balance sheet, and a statement of cash flows for Year 2.