Do you agree with the answers and what do you think about the last two tables c-3 & c-4?

At the beginning of 2013, the Bradley Company had the following balances in its accounts: Cash $ 3,600 Inventory 18,000 Common stock 20,000 Retained earnings 6.600 During 2014, the company experienced the following events: 1. Purchased inventory that cost $4,400 on account from Bivins Company under terms 1H0, nr'30. The merchandise was delivered FOB shipping point. Freight costs of $100 were paid in cash. 2. Returned $400 of the inventory that it had purchased because the inventory was damaged in transit. The seller agreed to pay the return freight cost. 3. Paid the amount due on its account payable to Bivins Company within the cash discount period. 4. Sold inventory that had cost $6,000 for $11,000 on account, under terms 2310, N45. 5. Received merchandise retumed from a customer. The merchandise originally cost $800 and was sold to the customer for $1,450 cash. The customer was paid $1,4 50 cash for the returned merchandise. 6. Delivered goods FOB destination in Event 4. Freight costs of $120 were paid in cash. 7. Collected the amount due on the account receivable within the discount period. 3. Took a physical count indicating that $15,500 of inventory was on hand at the end of the accounting period. Required e. Identify these events as asset source (AS), asset use (AU), asset exchange (AE). or claims exchange (CE). (Select "NA\" If there is no effect on the "Claeeleatlon".} 1a (purchase inventory}. A 1b (shipping cost). AE 4a (recording revenue). AS 5a (reversing revenue). AU 5h (reversing cost of goods sold). AS 4b (recording cost of goods sold}. 2. Required information b. Record each event in a statements model like the following one. In the Cash Flow column, use OA to designate operating activity, IA for investment activity, FA for financing activity, NC for net change in cash and NA to indicate the element is not affected by the event. The first event is recorded as an example. (Enter any decreases to account balances and cash outflows with a minus sign.) BRADLEY COMPANY Horizontal Statements Model - 2014 Balance Sheet Income Statement Event Assets = Liabilities + Stockholders' Equity Cash Common Retained Revenue - Expenses = Net Statement of Cash Accounts Merchandise Accounts Flows Receivable Inventory Payable + Stock Earnings Income Bal. 8,600 + + 18,000 + 20,000 + 6,600 NA 1a. + 0 + 4,400 4,400 + + 0 0 11 0 ONA 1b (190 + 0+ 190 0 + 0 + 0 0 O (190) OA 2 0 0 + 400 (400) + 0 1+ 0 0 0 ONA 3 (3,960) + 0 + (40) = '4,000) + + 0 0 OE 0 (3,960) OA 4a. + 11,000 + 0 0 + ol+ 11,000 11,000 O= 11,000 ONA 4b. 0 + 0+ (6,000) 0 + 0+ (6,000 0 6,000 = (6,000) ONA 5a. (1,450) + 0 + 0 = 0 + O + (1,450) (1,450) 0 E (1,450) (1,450) OA 5b. 0 1+ 0+ 11 11 0 + 0 + BOC 0 800) 30C ONA 6 120 + 0+ 0 0+ + (120) 0 120 (120) (120) OA 7. 10,780 + (11,000) + 0 1I o+ O + 220 220) 0 (220 10,780 OA 8 0 0 + (1,450) 11 O + 0 + (1,450) 0 1,450 (1,450) ONA Bal. $ 13,660 + $ 0+ $ 15,500 = $ 0 + $ 20,000 + $ 9,160 $ 9,330 $ 6,770 = $ 2,560 $ 5,0603. Prepare a multistep income statement. BRADLEY COMPANY Income Statement For the Year Ended December 31, 2014 Net sales $ 9,330 Cost of goods sold (6,650) Gross margin 2,680 Operating expenses Transportation-out (120) Net income $ 2,560 : c- Prepare a statement of changes in stockholders' equity. 2. BRADLEY COMPANY Statement of Changes in Stockholders' Equity For the Year Ended December 31, 2014 Beginning common stock $ 20,000 Plus: Stock issued 0 Ending common stock $ 20,000 Beginning retained earnings $ 6,600 Plus: Net income 2,560 Ending retained earnings 9,160 Total stockholders' equity $ 29,160c- Prepare a balance sheet. 3. BRADLEY COMPANY Balance Sheet As of December 31, 2014 Assets Total assets 0 Liabilities Stockholders' Equity Total stockholders' equity Total liabilities and stockholders' equity 0 c- Prepare a statement of cash flows. (Enter cash outflows as negative amounts.) 4. BRADLEY COMPANY Statement of Cash Flows For the Year Ended December 31, 2014 Cash flows from operating activities Net cash flow from operating activities 0 Cash flows from investing activities Cash flows from financing activities Net change in cash Ending cash balance 0