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 2. Purchased inventory for $26,800 cash. 3. Sold inventory costing $16,100 for $32,000 cash Required a. Record the events in a horizontal financial statements model. b. Prepare an income statement for Year 1 (use the multistep format). c. What is the amount of total assets at the end of the period? es DAN WATSON MERCHANDISING Effect of Events on Financial Statement Balance Sheet Income Statement Assets Stockholders' Equity Common Retained Revenue - Net Income Expenses Inventory Stock Earnings Statement of Cash Flows Event Cash + 1 1. 2. 3a ++ + + + 3b. Total III 0 0 0 0 0 0 = 0 Hequired Required > Prepare an income statement for Year 1 (use them DAN WATSON MERCHANDISING Income Statement For the Year Ended December 31, Year 1 0