1. On January 15, ABC Co, Inc. purchases inventory of $7,000 for A Vender on account. The terms of the credit are 2/15, net 30. On January 28, the company pays their account balance at A Vendor. On January 30, ABC sells of the inventory to XYZ, Co. for $8,000 on credit. ABC gives the credit terms of 2/10, net 60 to XYZ. XYZ pays the entire balance on February 8. ABC had the following expenses for January and February:

Wages 500

Utilities 300

Miscellaneous 200

Make all the applicable journal entries.

Prepare the multi-step income statement.