2.

Gunn Manufacturing Company experienced the following accounting events during its first year of operation. With the exception of the adjusting entries for depreciation, assume that all transactions are cash transactions.

1.	Acquired $80,000 cash by issuing common stock.
2.	Paid $9,200 for the materials used to make its products, all of which were started and completed during the year.
3.	Paid salaries of $3,800 to selling and administrative employees.
4.	Paid wages of $12,000 to production workers.
5.	Paid $9,600 for furniture used in selling and administrative offices. The furniture was acquired on January 1. It had a $1,600 estimated salvage value and a four-year useful life.
6.	Paid $16,000 for manufacturing equipment. The equipment was acquired on January 1. It had a $1,000 estimated salvage value and a five-year useful life.
7.	Sold inventory to customers for $38,000 that had cost $18,000 to make.

Required

Show how these events would affect the balance sheet, income statement, and statement of cash flows by recording them in a horizontal financial statements model as indicated here. Also, in the Cash Flow column, indicate whether the cash flow is for operating activities (OA), investing activities (IA), or financing activities (FA). Use NA to indicate that an element is not affected by the event. The first event is recorded as an example.(Enter any decreases to account balances and cash outflows with a minus sign.)

3 & 4

[The following information applies to the questions displayed below.]

Antioch Company makes eBook readers. The company had the following amounts at the beginning of 2014: Cash, $660,000; Raw Materials Inventory, $51,000; Work in Process Inventory, $18,000; Finished Goods Inventory, $43,000; Common Stock, $583,000; and Retained Earnings, $189,000. Antioch experienced the following accounting events during 2014. Other than the adjusting entries for depreciation, assume that all transactions are cash transactions.

1.	Paid $23,000 of research and development costs.
2.	Paid $47,000 for raw materials that will be used to make eBook readers.
3.	Placed $83,000 of the raw materials cost into the process of manufacturing eBook readers.
4.	Paid $60,000 for salaries of selling and administrative employees.
5.	Paid $91,000 for wages of production workers.
6.	Paid $90,000 to purchase equipment used in selling and administrative offices.
7.	Recognized depreciation on the office equipment. The equipment was acquired on January, 1, 2014. It has a $10,000 salvage value and a five-year life. The amount of depreciation is computed as [(Cost salvage) useful life].Specifically, ($90,000 $10,000) 5 = $16,000.
8.	Paid $165,000 to purchase manufacturing equipment.
9.	Recognized depreciation on the manufacturing equipment. The equipment was acquired on January 1, 2014. It has a $25,000 salvage value and a seven-year life. The amount of depreciation is computed as [(Cost salvage) useful life]. Specifically, ($165,000 $25,000) 7 = $20,000.
10.	Paid $45,000 for rent and utility costs on the manufacturing facility.
11.	Paid $70,000 for inventory holding expenses for completed eBook readers (rental of warehouse space, salaries of warehouse personnel, and other general storage cost).
12.	Completed and transferred eBook readers that had total cost of $240,000 from work in process inventory to finished goods.
13.	Sold 1,000 eBook readers for $420,000.
14.	It cost Antioch $220,000 to make the eBook readers sold in Event 13.