Franklin Manufacturing Company experienced the following accounting events during its first year of operation. With the exception of the adjusting entries for depreciation, assume that all transactions are cash transactions and that financial statement data are prepared in accordance with GAAP. 1. Acquired $56,000 cash by issuing common stock. 2. Paid $7,800 for the materials used to make its products, all of which were started and completed during the year. 3. Paid salaries of $4,300 to selling and administrative employees. 4. Paid wages of $6,800 to production workers. 5. Paid $5,300 for furniture used in selling and administrative offices. The furniture was acquired on January 1. It had a $1,300 estimated salvage value and a four-year useful life. 6. Paid $8,800 for manufacturing equipment. The equipment was acquired on January 1. It had a $1,000 estimated salvage value and a two-year useful life. 7. Sold inventory to customers for $25,900 that had cost $13,400 to make. Required Indicate how these events would affect the balance sheet and income statement by recording them in a horizontal financial statements model as indicated here. The first event is recorded as an example. (Enter any decreases to account balances with a minus sign. In the Cash Flow column, indicate whether the item is an operating activity (OA), investing activity (IA), financing activity (FA), or leave the cell blank if there is no effect.) Required Indicate how these events would affect the balance sheet and income statement by recording them in a horizontal financial statements model as indicated here. The first event is recorded as an example. (Enter any decreases to account balances with a minus sign. In the Cash Flow column, indicate whether the item is an operating activity (OA), investing activity (IA), financing activity (FA), or leave the cell blank if there is no effect.) Event No. Financial Statements Model Equity Office Common. Furn. stock 56,000 Assets Manuf. + Inventory Equip. + Cash Income Statement - Exp. = Ret. Ear. Rev. Net Inc. Cash flow 56,000 56,000 FA 1 2 + + + + + + + + + Total 56,000 + 0 = 56,000 + 0 = + 0 56,000