Sage Inc. experienced the following transactions for Year 1, its first year of operations: Issued common stock for $120,000 cash. Purchased $200,000 of merchandise on account. Sold merchandise that cost $154,000 for $306,000 on account. Collected $274,000 cash from accounts receivable. Paid $180,000 on accounts payable. Paid $56,000 of salaries expense for the year. Paid other operating expenses of $72,000. Sage adjusted the accounts using the following information from an accounts receivable aging schedule: Number of Days Past Due Amount Percent Likely to Be Uncollectible Allowance Balance Current $ 19,200 0.01 030 8,000 0.05 3160 1,600 0.10 6190 1,600 0.20 Over 90 days 1,600 0.50 b. Prepare the income statement, statement of changes in stockholders equity, balance sheet, and statement of cash flows for Sage Inc. for Year 1.

Required information [The following information applies to the questions displayed below. Sage Inc. experienced the following transactions for Year 1, its first year of operations: 1. Issued common stock for $120,000 cash. 2. Purchased $200,000 of merchandise on account. 3. Sold merchandise that cost $154,000 for $306,000 on account. 4. Collected $274,000 cash from accounts receivable. 5. Paid $180,000 on accounts payable. 6. Paid $56,000 of salaries expense for the year. 7. Paid other operating expenses of $72,000. 8. Sage adjusted the accounts using the following information from an accounts receivable aging schedule: Number of Days Past Due Current 0-30 31-60 61-90 Over 90 Amount $19,200 8,000 1,600 1,600 1,600 Percent Likely to Be Allowance Uncollectible Balance 0.01 0.05 0.10 0.20 0.50 days b. Prepare the income statement, statement of changes in stockholders' equity, balance sheet, and statement of cash flows for Sage Inc. for Year 1. Complete this question by entering your answers in the tabs below. Required Required Required Required B Inc B Stmt B Bal B Stmt Prepare the balance sheet for Sage Inc. for Year 1. (Be sure to list the assets in the order of their liquidity.) SAGE INC. Balance Sheet As of the End of the Year 1 Assets Cash Accounts receivable Less: Allowance for doubtful accounts Merchandise inventory Total assets Liabilities Accounts payable 0 $ 0 0 Total liabilities Stockholders' equity Common stock Retained earnings 0 Total stockholders' equity Total liabilities and stockholders' equity $ 0