The Pet Store experienced the following events for the 2018 accounting period:

Acquired $80,000 cash from the issue of common stock.

Purchased $76,000 of inventory on account.

Received goods purchased in Event 2 FOB shipping point; freight cost of $1,850 paid in cash.

Sold inventory on account that cost $43,000 for $81,000.

Freight cost on the goods sold in Event 4 was $1,300. The goods were shipped FOB destination. Cash was paid for the freight cost.

Customer in Event 4 returned $4,000 worth of goods that had a cost of $2,050.

Collected $66,420 cash from accounts receivable.

Paid $64,200 cash on accounts payable.

Paid $3,550 for advertising expense.

Paid $3,260 cash for insurance expense.

Required

Which of these events affect period (selling and administrative) costs? Which result in product costs? If neither, label the transaction NA.

Record the above events in a horizontal statement model. In the Cash Flow column, use OA to designate operating activity, IA for investment activity, FA for financing activity, NC for net change in cash and NA to indicate the element is not affected by the event. The beginning balances have been recorded as an example.

Required A Required B Which of these events affect period (selling and administrative) costs? Which result in product costs? If neither, label the transaction NA Transaction Cost 3. 4. 6 7 10