Required information [The following information applies to the questions displayed below.] The trial balance for Terry's Auto Shop as of January 1, Year 2, follows Account Titles Cash Inventory Common Stock Retained Earnings Total Debit $15,020 3,000 Credit 7, 350 10,670 $ 18,020 $18,020 The following events affected the company during the Year 2 accounting period 1. Purchased merchandise on account that cost $4,220 2. The goods in Event 1 were purchased FOB shipping point with freight cost of $290 cash 3. Returned $465 of damaged merchandise for credit on account. 4. Agreed to keep other damaged merchandise for which the company received an $290 allowance 5. Sold merchandise that cost $2,66O for $13,700 cash. 6. Delivered merchandise to customers in Event 5 under terms FOB destination with freight costs amounting to $175 cash. 7. Paid $2,870 on the merchandise purchased in Event 1 8. Paid $8,960 cash for operating expenses c. Prepare a multistep income statement, balance sheet, and statement of cash flows (Assume that closing entries have been made.)