Reference no: EM132549084
Question - The following information is available for two different types of businesses for the Year 1 accounting year. Hopkins CPAs is a service business that provides accounting services to small businesses. Sports Clothing is a merchandising business that sells sports clothing to college students.
Data for Hopkins CPAs
1. Borrowed $91,800 from the bank to start the business.
2. Provided $61,200 of services to clients and collected $51,000 cash.
3. Paid salary expense of $32,640.
Data for Sports Clothing
1. Borrowed $91,800 from the bank to start the business.
2. Purchased $61,200 inventory for cash.
3. Inventory costing $26,520 was sold for $51,000 cash.
4. Paid $8,160 cash for operating expenses.
Required - Prepare an income statement, balance sheet, and statement of cash flows for each of the companies.