Reference no: EM132789913

The following information is available for two different types of business 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 $90.000 from the bank to start the business.

2. Provided $50,000 of services to clients and collected $50,000 cash.

3. Paid salary expense of $32,000

Data for Sports Clothing

1. Borrowed $90,000 from the bank to start the business.

2. Purchased $50,000 inventory for cash

3. Inventory costing $26,000 wwas sold for $50,000 cash.

4. Paid $8,000 cash for operating expenses.

Required

Problem a. Prepare an income statement, balance sheet, and statement of cash flows for each of the companies.