Required information [The following information applies to the questions displayed below.) The following transactions apply to Ozark Sales for Year 1: 1. The business was started when the company received $49,000 from the issue of common stock. 2. Purchased equipment inventory of $178,000 on account. 3. Sold equipment for $197,000 cash (not including sales tax). Sales tax of 7 percent is collected when the merchandise is sold. The merchandise had a cost of $122,000. 4. Provided a six-month warranty on the equipment sold. Based on industry estimates, the warranty claims would amount to 4 percent of sales. 5. Paid the sales tax to the state agency on $147,000 of the sales. 6. On September 1, Year 1, borrowed $19,500 from the local bank. The note had a 6 percent interest rate and matured on March 1, Year 2. 7. Paid $5,500 for warranty repairs during the year. 8. Paid operating expenses of $52,000 for the year. 9. Paid $124,500 of accounts payable. 10. Recorded accrued interest on the note issued in transaction no. 6. b-1. Prepare the income statement for Year 1. (Round your answers to the nearest dollar amount.) OZARK SALES Income Statement For the Year Ended December 31, Year 1 Sales revenue Cost of goods sold Gross margin Expenses Warranty expense 7,880 Other operating expenses 52,000 $ 197,000 122,000 75,000 59,880 Total operating expenses Operating income Interest expense 15,120 667 0 $ 14,453 b-2. Prepare the balance sheet for Year 1. (Round your answers to the nearest dollar amount.) OZARK SALES Balance Sheet As of December 31, Year 1 Assets Cash Merchandise inventory $ 0 Total assets Liabilities Accounts payable Sales tax payable Warranty payable Interest payable Notes payable 0 Total liabilities Stockholders' equity Common stock Retained earnings 0 Total stockholders' equity Total liabilities and stockholders' equity $ 0 b-3. Prepare the statement of cash flows for Year 1. (Amounts to be deducted and losses should be indicated with minus sign. Round your answers to the nearest dollar amount.) OZARK SALES Statement of Cash Flows For the Year Ended December 31, Year 1 Cash flow from operating activities: $ 0 Net cash flow from operating activities Cash flows from investing activities: Cash flows from financing activities 0 Net cash flows from financing activities Net change in cash 0 Ending cash balance $ 0