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 $96,300 from the bank to start the business. 2. Provided $64,200 of services to clients and collected $53,500 cash. 3. Paid salary expense of $34,240. Data for Sports Clothing 1. Borrowed $96,300 from the bank to start the business. 2. Purchased $64,200 inventory for cash. 3. Inventory costing $27,820 was sold for $53,500 cash. 4. Paid $8,560 cash for operating expenses. Required a. Prepare an income statement, balance sheet, and statement of cash flows for each of the companies.

Income Statement

$

Sales Revenue

           64,200

Less: Operating Expenses

Salary Expense

           34,240

Net Income

           29,960

Assets

$

$

Current Assets

Cash ($96,300 + 53,500 - 34,240)

       115,560

Accounts Receivable ($64,200 - 53,500)

           10,700

Total Current Assets

        126,260

Liabilities & Stockholder's Equity

Long Term Liability

Notes Payable (borrowed from bank)

           96,300

Stockholder's Equity

Retained Earnings

           29,960

Total Liabilities & Equity

        126,260

Cash flow from operating activities

$

$

Cash receipts from Customers

           53,500

Cash paid for Salary Expense

         -34,240

Cash from Operating Activities

           19,260

Cash from Investing Activities

Cash from Financing Activities

                     -  

Borrowed from bank

           96,300

Net Increase in Cash

        115,560

Add: Cash balance beginning

                     -  

Cash Balance Ending

        115,560

Income Statement

$

Sales Revenue

           53,500

Less: Cost of goods sold

           27,820

Gross Margin

           25,680

Less: Operating Expenses

             8,560

Net Income

           17,120

Assets

$

$

Current Assets

Cash ($96,300 + 53,500 - 64,200 - 8,560)

           77,040

Inventory ($64,200 - 27,820)

           36,380

Total Current Assets

        113,420

Liabilities & Stockholder's Equity

Long Term Liability

Notes Payable (borrowed from bank)

           96,300

Stockholder's Equity

Retained Earnings

           17,120

Total Liabilities & Equity

        113,420

Cash flow from operating activities

$

$

Cash sales receipts

           53,500

Cash purchases payments

         -64,200

Cash paid for Salary Expense

            -8,560

Cash from Operating Activities

          -19,260

Cash from Investing Activities

Cash from Financing Activities

                     -  

Borrowed from bank

           96,300

Net Increase in Cash

           77,040

Add: Cash balance beginning

                     -  

Cash Balance Ending

           77,040