$2)$ Recording transactions and preparing financial statements question $(40$ points; $1$ point for each journal entry. $1$ point for each $\backslash ($ T $\backslash )$ account, and $5$ points for each of the income statement and the balance sheet$)$

Newby Inc., incorporated and began business on January $1,2020.$ During the first quarter of $2020,$ the following transactions occurred.

a$)$ On January $1,$ Newby issued no par value stock for $\backslash (\backslash$$ $200\backslash )$ cash.

b$)$ On January $1,$ Newby borrowed $\backslash (\backslash$$ $500\backslash )$ from a bank. The bank charges interest of $2$ percent on the outstanding borrowing per quarter, but requires no payment of either principal or interest during the quarter.

c$)$ On January $1,$ Newby signed a six$-$month rental contract that required rental payments of $\backslash (\backslash$$ $8\backslash )$ per month, payable $($and paid$)$ on the $\backslash (15^\{\backslash$text $\{$th $\}\}\backslash )$ of the month.

d$)$ On January $1,$ Newby hired its sole employee to a one$-$year contract paying $\backslash (\backslash$$ $60\backslash )$ per year. The employee is paid on the last day of each month for that month's work.

e$)$ On January $1,$ Newby bought store fixtures for $\backslash (\backslash$$ $240\backslash )$ cash. The fixtures have a useful life of $10$ years and no salvage value. Depreciation expense is a constant amount each quarter during the useful life of the fixtures. $($You may record depreciation expense either directly to property, plant, and equipment or to accumulated depreciation.$)$

f$)$ On January $10,$ Newby acquired inventory for $\backslash (\backslash$$ $60\backslash ),$ paying cash of $\backslash (\backslash$$ $20\backslash )$ with the rest being on account.

g$)$ On February $20,$ Newby sold inventory costing $\backslash (\backslash$$ $40\backslash )$ for $\backslash (\backslash$$ $20\backslash )$ cash and $\backslash (\backslash$$ $70\backslash )$ on account.

h$)$ On March $10,$ Newby paid its suppliers for the previously unpaid portion of the cost of the acquired inventory and, in addition, prepaid suppliers $\backslash (\backslash$$ $30\backslash )$ cash for specialized inventory to be delivered in April.

Required: Record the journal entries for the explicit transactions listed above as they occur, for any transactions involving cash on the day that cash changes hands, and for the adjusting entries and closing entry on March $31,2020($i$.$e$.,$ the last day of the first quarter of $2020).$ Indicate the day on which each journal entry should be made. Post the journal entries to T accounts. Prepare the income statement for the first quarter of $2020$ and the balance sheet at the end of that quarter. $($You need not prepare a trial balance, but if you do I will use it to award partial credit.$)$

A partial income statement for Bothawaxs in $2020($the amounts of expenses are in parentheses$)$ is: A partial cash flow statement for Bothaways in $2020($the amounts of expenditures are in parentheses$)$ are:

Required: Bothaways did not acquire any Property, plant, and equipment during $2020.$ All line items with non$-$zero values are presented on each of the financial statements. Answer the following questions.

a$)$ What is net cash flow?

b$)$ What are collections from customers?

c$)$ What is cost of goods sold?

d$)$ What are payments to employees?

e$)$ What is operating cash flow?

f$)$ What is rent expense?

g$)$ What is depreciation expense?

h$)$ What is net income?

i$)$ What are dividends declared?

j$)$ What are dividends paid?

Extra Credit $(4$ points$)$: There are two distinct ways to solve for dividends paid in part j$.$ Calculate dividend paid the way other than the one you used above to solve for it$.$