Dan Watson started a small merchandising business in Year 1. The business experienced the following events during its first year of operation. Assume that Watson uses the perpetual inventory system.

1. Acquired $33,500 cash from the issue of common stock.

Purchased inventory for $26,800 cash.

Sold inventory costing $18,500 for $31,500 cash.

Required

1. Record the events in a horizontal statement model. In the Cash Flow column, use OA to designate operating activity, IA for investment activity, FA for financing activity, or NC for net change in cash. If the element is not affected by the event, leave the cell blank.
2. Prepare an income statement for Year 1 (use the multistep format).
3. What is the amount of total assets at the end of the period?

Prepare an income statement for Year 1 (use the multistep format). Complete this question by entering your answers in the tabs belo What is the amount of total assets at the end of the period