Problem $1-21$A $($Static$)$ Effect of product versus period costs on financial statements LO $1-3$

Sinclair Manufacturing Company experienced the following accounting events during its first year of operation. With the exception of

the adjusting entries for depreciation, assume that all transactions are cash transactions and that financial statement data are prepared

in accordance with GAAP.

Acquired $$68,000$ cash by issuing common stock.

Paid $$8,700$ for the materials used to make its products, all of which were started and completed during the year.

Paid salaries of $$4,500$ to selling and administrative employees.

Paid wages of $$10,000$ to production workers.

Paid $$9,600$ for furniture used in selling and administrative offices. The furniture was acquired on January $1.$ It had a $$1,600$

estimated salvage value and a four$-$year useful life.

Paid $$16,000$ for manufacturing equipment. The equipment was acquired on January $1.$ It had a $$1,000$ estimated salvage value and

a five$-$year useful life.

Sold inventory to customers for $$35,000$ that had cost $$14,000$ to make.

Required

How these events would affect the balance sheet and income statement by recording them in a horizontal financial statements model

as indicated here. The first event is recorded as an example.

Note: Enter decreases to account balances with a minus sign.