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  3. powell company began the year 3 accounting period

Powell Company began the Year 3 accounting period with $42,000 cash, $88,000 inventory, $62,000 common...

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Accounting

Powell Company began the Year 3 accounting period with $42,000 cash, $88,000 inventory, $62,000 common stock, and $68,000 retained earnings. During Year 3, Powell experienced the following events: Sold merchandise costing $59,000 for $101,500 on account to Prentise Furniture Store. Delivered the goods to Prentise under terms FOB destination. Freight costs were $900 cash. Received returned goods from Prentise. The goods cost Powell $4,200 and were sold to Prentise for $6,200. Granted Prentise a $3,200 allowance for damaged goods that Prentise agreed to keep. Collected partial payment of $82,500 cash from accounts receivable. Required: Use a horizontal financial statements model to show how each event affects the balance sheet, income statement, and statemen

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