please explain what is incorrect

On January 1, Year 1, Jana started a small flower merchandising business that she named Jana's Flowers. The company experienced the following events during the rst year of operation: 1. Started the business by issuing common stock for $12,000 cash. 2. Paid $8,000 cash to purchase inventory. 3. Sold merchandise that cost $5,000 for $11,000 on account. 4. Collected $10,000 cash from accounts receivable. 5. Paid $2,500 for operating expenses. Required 3. Organize ledger accounts under an accounting equation and record the events in the accounts. In the last column of the table, provide appropriate account tides for the Retained Earnings amounts. b-1. Prepare an income statement. b-2. Prepare a balance sheet. b-3. Prepare a statement of cash ows. 1:. Since Jana sold inventory for $11,000, she will be able to recover more than half of the $12,000 she invested in the stock. Do you agree with this statement? JANA'S FLOWERS Effect of Events on the Accounting Equation Assets Stockholders' Equity Event Cash + Accounts Accounts Titles for Receivable + Inventory Common Retained Stock Earnings Retained Earnings 1. 12,000 + = 12,000 V + 2. (8,000) + + 8,000 3a. + 11,000 + 11,000 V 3b. + (5,000) (5,000) 4. 10,000 + (10,000) + 5. (2,500) + + S (2,500) Total 11,500 1,000 + 3,000 12,000 + 3,500Prepare an income statement. JANA'S FLOWERS Income Statement For the Year Ended December 31, Year 1 Sales revenue 11,000 Cost of goods sold 5.000 Gross margin 6,000 Operating expenses 2,500 Net income 69 3.500Prepare a balance sheet. JANA'S FLOWERS Balance Sheet As of December 31, Year 1 Assets Cash $ 11,500 Merchandise inventory 3,000 Accounts receivable v 1,000 Total assets 15,500 Liabilities Stockholders' Equity Common stock $ 12,000 Retained earnings 3,500 Total stockholders' equity 15,500 Total liabilities and stockholders' equity 15,500Prepare a statement of cash flows. (Cash outflows should be indic JANA'S FLOWERS Statement of Cash Flows For the Year Ending December 31, Year 1 Cash flows from operating activities: Outflow for inventory $ 8,000 X Inflow from customers 6,000 X Outflow for expenses 2,500 X Net cash flow from operating activities $ 16,500 Cash flows from investing activities: Cash flows from financing activities: Cash inflow from stock issue 12,000 Net cash flows from financing activities: 12,000 Net change in cash 28,500 Plus: Beginning cash balance Ending cash balance $ 28,500