Sweet Automobiles of Pepperell, Inc., was formed on January 1, 2010. The following transactions occurred during 2010:
On January 1, 2010, Sweet issued its common stock for $350,000. Early in January, Sweet made the following cash payments:
a. $140,000 for equipment
b. $175,000 for inventory (five cars at $35,000 each)
c. $19,000 for 2010 rent on a store building In February, Sweet purchased six cars for inventory on account. Cost of this inventory was $282,000 ($47,000 each). Before year end, Sweet paid $197,400 of this debt. Sweet uses the FIFO method to account for inventory. During 2010, Sweet sold six vintage autos for a total of $426,000. Before year-end, Sweet collected 90% of this amount. The business employs three people. The combined annual payroll is $90,000, of which Sweet owes $5,000 at year-end. At the end of the year, Sweet paid income tax of $14,000.
Late in 2010, Sweet declared and paid cash dividends of $16,000.
For equipment, Sweet uses the straight-line depreciation method, over five years, with zero residual value.

Requirements
1. Prepare Sweet Automobiles of Pepperell, Inc.’s income statement for the year ended December 31, 2010. Use the single-step format, with all revenues listed together and all expenses together.
2. Prepare Sweets balance sheet at December 31, 2010.
3. Prepare Sweets statement of cash flows for the year ended December 31, 2010. Format cash flows from operating activities by using the indirect method.