The following transactions apply to Ozark Sales for Year $1$:

$1$

points

$031027$

The business was started when the company received $$48,000$ from the issue of common stock.

Purchased equipment inventory of $$174,500$ on account.

Sold equipment for $$199,000$ cash $($not including sales tax$).$ Sales tax of $7$ percent is collected when the merchandise is sold. The merchandise had a cost of $$124,000$

Provided a six$-$month warranty on the equipment sold. Based on industry estimates, the warranty claims would amount to $5$ percent of sales.

Paid the sales tax to the state agency on $$149,000$ of the sales.

On September $1,$ Year $1,$ borrowed $$22,000$ from the local bank. The note had a $6$ percent interest rate and matured on March $1,$ Year $2$

Paid $$5,600$ for warranty repairs during the year:

Paid operating expenses of $$55,000$ for the year.

Paid $$125,100$ of accounts payable.

Recorded accrued interest on the note issued in transaction no$.6.$

Required

a$.$ Record the given transactions in a horizontal statements model.

b$.$ Prepare the income statement, balance sheet, and statement of cash flows for Year $1.$

References

c$.$ What is the total amount of current liabilities at December $31,$ Year $1?$