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The following transactions apply to Ozark Sales for Year 1: The business was started when the company received $49,000 from the issue of common stock.
The following transactions apply to Ozark Sales for Year 1:
- The business was started when the company received $49,000 from the issue of common stock.
- Purchased equipment inventory of $174,000 on account.
- Sold equipment for $194,500 cash (not including sales tax). Sales tax of 7 percent is collected when the merchandise is sold. The merchandise had a cost of $119,500.
- Provided a six-month warranty on the equipment sold. Based on industry estimates, the warranty claims would amount to 4 percent of sales.
- Paid the sales tax to the state agency on $144,500 of the sales.
- On September 1, Year 1, borrowed $20,500 from the local bank. The note had a 7 percent interest rate and matured on March 1, Year 2.
- Paid $5,900 for warranty repairs during the year.
- Paid operating expenses of $53,000 for the year.
- Paid $125,400 of accounts payable.
- 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.)
b-2. Prepare the balance sheet for Year 1. (Round your answers to the nearest dollar amount.)
b-3. Prepare the statement of cash flows for Year 1. (Enter amounts to be deducted and cash outflows with a minus sign. Round your answers to the nearest whole dollar.)
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