. Prepare a multistep income statement, balance sheet, and statement of cash flows. (Assume that closing entries have been m Complete this question by entering your answers in the tabs below. Prepare an income statement. Exercise 4-12A (Algo) Effect of purchase returns and allowances and freight costs on the journal, ledger, and financial statements: Perpetual system LO 4-2, 4-4, 4-6 [The following information applies to the questions displayed below] The trial balance for Terry's Auto Shop as of January 1, Year 2, follows: The following events affected the company during the Year 2 accounting period: 1. Purchased merchandise on account that cos$44,260. 2. The goods in Event 1 were purchased FOB shipping point with freight cost of $200 cash. 3. Retumed $490 of damaged merchandise for credit on account. 4. Agreed to keep other damaged merchandise for which the company received an $210 allowance. 5. Sold merchandise that cost $2,590 for $13,800 cash. 6. Delivered merchandise to customers in Event 5 under terms FOB destination with freight costs amounting to $190 cash. 7. Paid $2,890 on the merchandise purchased in Event 1. 8. Paid $8,910 cash for operating expenses. Exercise 4-12A (Algo) Part c c. Prepare a multistep income statement, balance sheet, and statement of cash flows. (Assume that closing entries have been made) Complete this question by entering your answers in the tabs below. Propare an income statement. Prepare a balance sheet. Prepare a statement of cash flows. (Assume that closing entries have been made.) minus sign.)