how to find retain earningsThe transactions relating to the formation of Blue Company Stores Incorporated, and its first month of operations follow.

a$.$ The firm was organized and the stockholders invested cash of $$30,000.$

b$.$ The firm borrowed $$20,000$ from the bank; a short$-$term note was signed.

c$.$ Display cases and other store equipment costing $$16,800$ were purchased for cash. The original list price of the equipment was

$$21,000,$ but a $20\%$ discount was received because the seller was having a sale.

d$.$ A store location was rented, and $$4,500$ was paid for the first month's rent.

e$.$ Inventory of $$40,000$ was purchased; $$25,000$ cash was paid to the suppliers, and the balance will be paid within $30$ days.

f$.$ During the first week of operations, merchandise that had cost $$16,000$ was sold for $$23,000$ cash.

g$.$ A newspaper ad costing $$300$ was arranged for; it ran during the second week of the store's operations. The ad will be paid for in

the next month.

h$.$ Additional inventory costing $$12,500$ was purchased; cash of $$4,000$ was paid, and the balance is due in $30$ days.

i$.$ In the last three weeks of the first month, sales totaled $$41,000,$ of which $$27,700$ was sold on account. The cost of the goods sold

totaled $$26,000.$

j$.$ Employee wages for the month totaled $$5,700$; these will be paid during the first week of the next month.

k$.$ The firm collected a total of $$18,400$ from the sales on account recorded in transaction $i.$

I. The firm paid a total of $$11,600$ of the amount owed to suppliers from transaction $e.$

Required:

a$.$ Record each transaction in the appropriate columns. Indicate the financial statement effect.

b$.$ Calculate the total assets, liabilities, and stockholders' equity at the end of the month and calculate the amount of net income for

the month.

c$.1.$ After recording transactions a through I, prepare an income statement for Blue Company Stores Incorporated for the month

presented.

After recording transactions a through I, prepare a balance sheet at the end of the month. I need to figure out what to put down on retained earning column