Problem 10-2 Ashton Company makes eBook readers. The company had the following amounts at the beginning of 2016: $1,380,000 Cash Raw Materials Inventory 106,000 Work in Process Inventory Finished Goods Inventory 90,000 $ 1.212,000 Common Stock 404,000 Retained Earnings 1. Paid 50,000 of research and development costs 114,000 for raw materials that will be used to make eBook readers 2. Paid 3. Placed 200,000 of the raw materials cost into the process of manufacturing eBook readers 150,000 for salaries of selling and administrative employees. 240,000 for wages of production workers 16,000 to purchase equipment used in selling and administrative office 4. Paid 6. Paid 7. Recognized depreciation on the office equipment. The equipment was acquired on January, 1 2016. It has a 20,000 salvage value anda 500,000 cash to purchase manufacturing equipment. 10 year life 8. Paid 9. Recognized depreciation on the manufacturing equipment. The equipment was acquired on Jan 1 2016. It has a S0 salvage value and a ear life 10. Paid 110,000 for rent and utility costs on the manufacturing facili 11. Paid 20,000 for inventory holding expenses for completed eBook readers (rental of warehouse space, salaries of warehouse personnel, and other general storage cost, this is not cost of goods) 12. Completed and transferred eBook readers that had total cost of inventory to finished goods 13. Sold $600,000 from work in proces $1,000,000 cash 2,000 eBook readers for $550,000 to make the eBook readers sold in Event 13 14. It cost Ashton REQUIRED a. Show how these events affect the balance sheet, income statement, and statement of cash flows by recording them in a horizontal financial statements model Hint: there are six asset accounts - you will need to adjust the template given and include more asset accounts,. b. Explain why Ashton's recognition of cost of goods sold had no impact on cash flow c. Prepare a schedule of cost of goods manufactured and sold, a formal income statement, and a balance sheet for the year. On the Balance sheet, split out the 3 different inventory accounts. d. Distinquish between the product costs and the upstream costs that Ashton incurred