Required information [The following information applies to the questions displayed below.) Powell Company began the Year 2 accounting period with $19,000 cash, $60,200 inventory, $48,400 common stock, and $30,800 retained earnings. During Year 2, Powell experienced the following events: 1. Sold merchandise that cost $38,200 for $75,200 on account to Prentise Furniture Store. 2. Delivered the goods to Prentise under terms FOB destination. Freight costs were $390 cash. 3. Received returned goods from Prentise. The goods cost Powell $1,820 and were sold to Prentise for $3,990, 4. Granted Prentise a $1,090 allowance for damaged goods that Prentise agreed to keep 5. Collected partial payment of $52,300 cash from accounts receivable. c. Prepare an income statement, balance sheet, and statement of cash flows. (Statement of Cash Flows only, items to be deducted must be indicated with a negative amount.) POWELL COMPANY Income Statement For the Year Ended December 31, Year 2 Net sales Cost of goods sold Gross margin Operating expenses Transportation-out Net income $ 0 0 POWELL COMPANY Balance Sheet As of December 31, Year 2 Assets Cash Accounts receivable Merchandise inventory Total assets $ 0 Liabilities Stockholders' Equity Common stock Retained earnings Total stockholders' equity Total liabilities and stockholders' equity 0 $ 0 POWELL COMPANY Statement of Cash Flows For the Year Ended December 31, Year 2 Cash flow from operating activities: Cash inflow from customers Cash outflow for expenses S 0 Net cash flow from operating activities Cash flows from investing activities Cash flows from financing activities Net change in cash Less: Beginning cash balance Ending cash balance 0 S 0