HO DESIGNS Balance Sheet As of December 31, Year 1 HO DESIGNS Income Statement For the Year Ended December 31, Year 1 \begin{tabular}{|lc|c|} \hline Net sales & & $28,200 \\ \hline Cost of goods sold & & \\ \hline Gross margin & & 28,200 \\ \hline Operating expenses & & 0 \\ \hline Net income & & $28,200 \\ \hline \end{tabular} Ho Designs experienced the following events during Year 1 , its first year of operation: 1. Started the business when it acquired $70,000 cash from the issue of common stock. 2. Paid $21,500 cash to purchase inventory. 3. Sold inventory costing $12,000 for $28,200 cash. 4. Physically counted inventory; had inventory of $7,300 on hand at the end of the accounting period. Required a. Record the events in the T-accounts provided. b. Prepare an income statement and balance sheet