Classic Automobiles of Cedar Grove, Inc., was formed on January 1, 2012. Th e following transactions occurred during 2012: On January 1, 2012, Classic issued its common stock for $430,000. Early in January, Classic made the following cash payments: a. $160,000 for equipment b. $234,000 for inventory (six cars at $39,000 each) c. $18,000 for 2012 rent on a store building In February, Classic purchased four cars for inventory on account. Cost of this inventory was $192,000 ($48,000 each). Before year-end, Classic paid $76,800 of this debt. Classic uses the FIFO method to account for inventory. During 2012, Classic sold seven vintage autos for a total of $504,000. Before year-end, Classic collected 50% of this amount. The business employs two people. Th e combined annual payroll is $60,000, of which Classic owes $9,000 at year-end. At the end of the year, Classic paid income tax of $22,000. Late in 2012, Classic declared and paid cash dividends of $18,000. For equipment, Classic uses the straight-line depreciation method, over five years, with zero residual value. Required: a) Prepare Cash flow statement using indirect method (12 points) b) Journalize the transactions (8 points)