American Rare Coins (ARC) was formed on January 1, 2018. Additional data for the year follow: a. On January 1, 2018, ARC issued no par common stock for $450,000 b. Early in January, ARC made the following cash payments: 2. Net Income $266,400 4. Net Cash Used by Op. Act. $(48,000) 1. For store fixtures, $53,000 2. For merchandise inventory, $340,000 3. For rent expense on a store building, $20,000 Later in the year, ARC purchased merchandise inventory on account for $239,000 Before year-end, ARC paid $139,000 of this accounts payable. c. d. During 2018, ARC sold 2,400 units of merchandise inventory for $275 each. Before year-end, the company collected 85% of this amount. Cost of goods sold for the year was $250,000, and ending merchandise inventory totaled $329,000 e. The store employs three people. The combined annual payroll is $96,000, of which f. At the end of the year, ARC paid income tax of $17,000. There are no income g. Late in 2018, ARC paid cash dividends of $44,000. ARC still owes $3,000 at year-end. taxes payable. h. For store fixtures, ARC uses the straight-line depreciation method, over five years, with zero residual value. Requirements 1. What is the purpose of the statement of cash flows? 2. Pre ARC's income statement for the year ended December 31, 2018. Use the pare single-step format, with all revenues listed together and all expenses listed together Prepare ARCs balance sheet at December 31, 2018. Prepare ARC's statement of cash flows using the indirect method for the year ended December 31, 2018. 3. 4