Required information [The following information applies to the questions displayed below.] Kaylee James, a connoisseur of fine chocolate, opened Kaylee's Sweets in Collegetown on February 1. The shop specializes in a selection of gourmet chocolate candies and a line of gourmet ice cream. You have been hired as manager. Your duties include maintaining the store's financial records. The following transactions occurred in February, the first month of operations. a. Received four shareholders' contributions totaling $28,500 cash to form the corporation; issued 600 shares of $0.10 par value common stock. b. Paid three months' rent for the store at $1,750 per month (recorded as prepaid expenses). c. Purchased and received candy for $5,800 on account, due in 60 days. d. Purchased supplies for $1,330 cash. e. Negotiated and signed a two-year $18,000 loan at the bank, receiving cash at the time. f. Used the money from (e) to purchase a computer for $2,550 (for recordkeeping and inventory tracking); used the balance for furniture and fixtures for the store. g. Placed a grand opening advertisement in the local paper for $430 cash; the ad ran in the current month. h. Made sales on Valentine's Day totaling $3,100; $2,710 was in cash and the rest on accounts receivable. The cost of the candy sold was $1,300. i. Made a $580 payment on accounts payable. j. Incurred and paid employee wages of $1,700. k. Collected accounts receivable of $170 from customers. 1. Made a repair to one of the display cases for $125 cash. m. Made cash sales of $3,100 during the rest of the month. The cost of the candy sold was $1,910. 3. Prepare an unadjusted income statement at the end of the first month of operations ended February 28. KAYLEE'S SWEETS Income Statement (unadjusted) For the Month Ended February 28 Revenues Sales revenue Expenses Cost of goods sold Advertising expense Wage expense Repair expense 0 Total revenues Net income