Purchase Returns JP Company started the accounting period with $5,000 in cash, $4,000 in Common Stock, and $1,000 in Retained Earnings. The following events occurred in Year 2. 1. Purchased inventory that costs $1,200 on account. 2. JP returned some of the inventory purchased in event 1. The list price of the inventory returned was $200. 3. JP sold the remaining inventory to customers for $1,800 cash. 4. JP paid for the inventory. Balance Sheet Income Statement Cash Flow Event Assets Liabilitys + Stockholders' Rev Exp NI Cash Equity Flow Cash Inventory Accounts Com. Ret. Payable Stk. Earn Beg. Bal. 5,000 4, 000 1,000 1,200 1,200 2 (200 (200 3 1,800 1,800 1,800 1.800 1, 800 OA 3 (1,000 (1,000 1,000 (1,000 4 1,000 (1.000 1,000 OA End 5,800 Bal. O O 4,000 1,800 1,860 1,000 800 800Account Titles Debit Credit Inventory 1,000 Accounts Payable 1,000\fAccount Titles Debit Credit Accounts Payable 1,000 Inventory 1,000