Problem 7-1 The following transactions apply to Kramer Corp. for 2016 1. The business was started when Kramer Corp. received $292,500 from the issue of common stock. $855,000 of merchandise on account. 3. $1,080,000 cash (not including sales tax). Sales tax of 6% is Sold merchandise for collected when the merchandise is sold. The merchandise had a cost of Good idea to split this into two accounting entries-think chapter 3. Provided a six-month warranty on the merchandise sold. Based on industry estimates, the warranty claims would amount to 4% of merchandise sales. Paid the sales tax of 6% to the state agency on On September 1, 2016, borrowed $652,500 4. $720,000 S112,500 from the local bank. The note had a of the sales. 5. 6. 6% annual interest rate and matures on August 31, 2017 7. Paid 8. Paid 9. Paid 10. Recorded accrued interest payable at the end of the year or 12/31 $18,000 for warranty repairs during the year. $279,000 cash in operating expenses for the year $612,000 of accounts payable REQUIRED a. b. c. Record the above transactions in a horizontal statements model. Prepare the income statement, balance sheet, and statement of cash flows for 2016. What is the total amount of current liabilities at December 31, 2016