ACCT 110 WEEK 3 CHAPTER 3 HW Patels Plants (PP)experienced the following events in 2021 and uses the perpetual Inventory method. For each event, show: For each event, show if and how cash, the balance sheet (A-L+E) and the income statement (R-E-NI) are affected, using specific dollar amounts and accounts. Show effect on the cash flow statement and what type of activity the transaction Is. OA, IA,FA. LDO PROBLEM IN ACCOUNTING EQUATION) ADD UP ALL ACCOUNTS TO MAKE SURE YOUR BALANCE (Show in equation form clearly and properly labeled) Be sure the equation balances. TOTAL ALL COLUMNS 1. PP Issued $85,000 of common stock. 2. PP purchased merchandise inventory on account for $95,000 3. The freight terms for the Inventory merchandise in #1 were FOB shipping point. PP paid the freight cost of $375 In cash. 4. An inspection revealed that some of the inventory purchased in #2 was defective, and that had a cost of $6,500. PP returned this merchandise to the supplier. 5. PP sold 200 plants at a sales price of $225 each ON ACCOUNT to customers. PP had purchased the merchandise Inventory sold for $15,000 (#2). HINT: It is now that the merchandise Inventory becomes an expense. (COST OF GOOD SOLD) 6. PP customers returned some merchandise PP had sold them in #5. The merchandise had been sold for the $3,000 and had been purchased by PP for $2,000. Remember this was purchased by the customer on account. (not cash) 7. PP paid (in cash) freight cost of $2,500 for goods delivered to customers in #5, FOB destination.