Powell Company began the 2018 accounting period with $36,000 cash, $74,000 inventory, $55,000 common stock, and $55,000 retained earnings. During 2018, Powell experienced the following events: 1. Sold merchandise costing $47,000 for $99,000 on account to Prentise Furniture Store. 2. Delivered the goods to Prentise under terms FOB destination. Freight costs were $700 cash. 3. Received returned goods from Prentise. The goods cost Powell $4,600 and were sold to Prentise for $6,600. 4. Granted Prentise a $2,600 allowance for damaged goods that Prentise agreed to keep 5. Collected partial payment of $79,000 cash from accounts receivable. Required a. Record the events in a statements model shown below. b. Prepare an income statement, a balance sheet, and a statement of cash flows. c. Why would Prentise agree to keep the damaged goods