The transactions relating to the formation of Blue Co. Stores Inc., and its first month of operations follow.

a. The firm was organized and the stockholders invested cash of $7,900.

b. The firm borrowed $4,900 from the bank; a short-term note was signed.

c. Display cases and other store equipment costing $1,650 were purchased for cash. The original list price of the equipment was $1,990, but a discount was received because the seller was having a sale.

d. A store location was rented, and $1,300 was paid for the first month's rent.

e. Inventory of $15,500 was purchased; $8,900 cash was paid to the suppliers, and the balance will be paid within 45 days.

f. During the first week of operations, merchandise that had cost $3,400 was sold for $6,700 cash.

g. A newspaper ad costing $120 was arranged for; it ran during the second week of the store's operations. The ad will be paid for in the next month.

h. Additional inventory costing $4,250 was purchased; cash of $1,350 was paid, and the balance is due in 30 days.

i. In the last three weeks of the first month, sales totaled $13,000, of which $9,400 was sold on account. The cost of the goods sold totaled $9,400.

j. Employee wages for the month totaled $1,800; these will be paid during the first week of the next month.

k. The firm collected a total of $3,400 from the sales on account recorded in transaction i.

l. The firm paid a total of $4,800 of the amount owed to suppliers from transaction e.

Required:

a. Record each transaction in the appropriate columns. Indicate the financial statement effect.

b. Calculate the total assets, liabilities, and stockholders' equity at the end of the month and calculate the amount of net income for the month.

c. After completing parts a through l, prepare an income statement for Blue Co. Stores Inc. for the month presented and a balance sheet at the end of the month.

Record each transaction in the appropriate columns. Indicate the financial statement effect. (Enter decreases with a minus sign to indicate a negative financial statement effect.) Transaction ASSETS Accounts + Receivable + Merchandise Inventory LIABILITIES STOCKHOLDERS' EQUITY Notes Accounts Paid-in Retained + Equipment = Payable + Payable + Capital + Earnings + Revenue Expenses Cash a. b. C. d. e. 1. g. h. i. j. k. 1. Complete this question by entering your answers in the tabs below. Required a Required B Required C1 Required C2 Calculate the total assets, liabilities, and stockholders' equity at the end of the month and calculate the amount of net income for the month. Assets Liabilities Stockholders' Equity Net Income After completing parts a through I, prepare an income statement for Blue Co. Stores Inc. for the month presented. (Enter decreases with a minus sign to indicate a negative income statement effect.) BLUE CO. STORES INC. Income Statement Effect Complete this question by entering your answers in the tabs below. Required a Required B Required C1 Required C2 After completing parts a through I, prepare a balance sheet for Blue Co. Stores Inc. at the end of the month. BLUE CO. STORES INC. Balance Sheet Assets: Total current assets Total assets Liabilities: Total liabilities Stockholders' Equity: Total stockholders' equity Total liabilities and stockholders' equity