a. On January 1, 2018, CRRC issued no par common stock for $550,000. b. Early in January, CRRC made the following cash payments: 1. For store fixtures, $51,000 2. For merchandise inventory, $310,000 3. For rent expense on a store building, $15,000 c. Later in the year, CRRC purchased merchandise inventory on account for $244,000. Before year-end, CRRC paid $164,000 of this accounts payable. d. During 2018, CRRC sold 2,000 units of merchandise inventory for $425 each. Before year-end, the company collected 80% of this amount. Cost of goods sold for the year was $340,000, and ending merchandise inventory totaled $214,000. e. The store employs three people. The combined annual payroll is $86,000, of which CRRC still owes $2,000 at year-end. f. At the end of the year, CRRC paid income tax of $15,000. There are no income taxes payable. g. Late in 2018, CRRC paid cash dividends of $39,000. h. For store fixtures, CRRC uses the straight-line depreciation method, over five years, with zero residual value. 1. 2. What is the purpose of the statement of cash flows? Prepare CRRC's income statement for the year ended December 31, 2018. Use the single-step format, with all revenues listed together and all expenses listed together. Prepare CRRC's balance sheet at December 31, 2018. Prepare CRRC's statement of cash flows using the indirect method for the year ended December 31, 2018. 3. 4. Requirement 1. What is the purpose of the statement of cash flows? The purpose of the statement of cash flows is to show where cash came from and how cash was spent during the period. Requirement 2. Prepare CRRC's income statement for the year ended December 31, 2018. Use the single-step format, with all revenues listed together and all expenses listed together. Classic Reserve Rare Coins Income Statement Year Ended December 31, 2018 Revenue: Sales Revenue 850,000 Expenses: Cost of Goods Sold $ 340,000 15,000 Rent Expense Salaries and Wages Expense Depreciation Expense 86,000 10,200 15,000 Income Tax Expense Total Expenses 466,200 383,800 Net Income Requirement 3. Prepare CRRC's balance sheet at December 31, 2018. Classic Reserve Rare Coins Balance Sheet December 31, 2018 Assets Liabilities Current Assets: Current Liabilities: Cash Accounts Payable 164000 Accounts Receivable Salaries Payable Merchandise Inventory Total Current Liabilities Total Current Assets Stockholders' Equity Property, Plant, and Equipment: Common Stock Store Fixtures 51000 Retained Earnings Less: Accumulated Depreciation Total Stockholders' Equity IM Total Assets Total Liabilities and Stockholders' Equity