Powell Company began the Year 2 accounting period with $20,000 cash, $60,900 inventory, $49,600 common stock, and $31,300 retained earnings. During Year 2, Powell experienced the following events:

Sold merchandise that cost $37,700 for $75,200 on account to Prentise Furniture Store.

Delivered the goods to Prentise under terms FOB destination. Freight costs were $375 cash.

Received returned goods from Prentise. The goods cost Powell $1,950 and were sold to Prentise for $3,860.

Granted Prentise a $1,080 allowance for damaged goods that Prentise agreed to keep.

Collected partial payment of $52,500 cash from accounts receivable.

A. Post the beginning balances and journal entries to the T-accounts.

B. Prepare a multistep income statement, a balance sheet, and a statement of cash flows.