The following transactions apply to Ozark Sales for Year 1:

1. The business was started when the company received $49,500 from the issue of common stock.
2. Purchased merchandise inventory of $176,000 on account.
3. Sold merchandise 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.
4. Provided a six-month warranty on the merchandise 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 $149,000 of the sales.
6. On September 1, Year 1, borrowed $21,500 from the local bank. The note had a 6 percent interest rate and matured on March 1, Year 2
7. Paid $5,800 for warranty repairs during the year.
8. Paid operating expenses of $55,000 for the year.
9. Paid $124,700 of accounts payable.
10. Recorded accrued interest on the note issued in transaction number 6.

prepare an income statement for year 1

[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 $49,500 from the issue of common stock. 2. Purchased merchandise inventory of $176,000 on account. 3. Sold merchandise 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. 4. Provided a six-month warranty on the merchandise sold. Based on industry estimates, the warranty ciaims would amount to 4 percent of sales. 5. Paid the sales tax to the state agency on $149,000 of the sales. 6. On September 1, Year 1, borrowed \$21,500 from the local bank. The note had a 6 percent interest rate and matured on March 1, Year 2. 7. Paid $5,800 for wafranty repairs during the year. 8. Paid operating expenses of $55,000 for the year. 9. Paid $124,700 of accounts payable. 10. Recorded accrued interest on the note issued in transaction number 6 . c-1. Prepare the income statement for Year 1