Income Statement for Year 1

Service Revenue 102,000

Operating Expenses
Salaries Expanse 24,000
UAE 750
Total 24,750
Net Income 77,250

Changes in SE for Year 1

Beginning Common Stock 0
Common Stock 5,000
Ending Common Stock 5,000
Beginning Retained Earnings 0
Net Income 77,250
Ending Retained Earnings 77,250
Total SE 82,250
 Balance Sheet for Year 1

Assets
Cash 68,000
Accounts Receivable 15,000
Allowance for Doubtful Accounts 750 14,250
Total Assets 82,250

Liabilities 0

Stockholders’ Equity
Common Stock 5,000
Retained Earnings 77,250
Total Stockholders’ Equity 82,250

Total Liabilities and Stockholders’ Equity 82,250

Statement of Cash Flows for Year 1

Cash Flows from Operating Acrivities

Inflow from Customers 87,000
Outflow from Expanses (24,000)
Net Cash Flow from Operating Activities 63,000
Cash Flows from Investing Activities 0
Cash Flows from Financing Activities
Inflow from Issue of Common Stock 5,000 5,000
Net Change in Cash 68,000
Beginning Cash Balance 0
Ending Cash Balance 68,000
 Income Statement for Year 2

Service Revenue 110,000

Operating Expenses
Salaries Expanse 35,000
UAE 839
Total (35,839)
Net Income 74,161

Changes in SE for Year 2

Beginning Common Stock 5,000
Common Stock 0
Ending Common Stock 5,000
Balance Sheet for Year 2
Beginning Retained Earnings 77,250
AssetsNet Income 74,161
Cash
Ending Retained Earnings 138,000
151,411
Accounts Receivable 19,380
Total SE for Doubtful Accounts
Allowance (969) 156,14118,411
Total Assets 156,411

Liabilities 0

Stockholders’ Equity
Common Stock 5,000
Retained Earnings 151,411
Total Stockholders’ Equity 156,411

Total Liabilities and Stockholders’ Equity 156,411

Statement of Cash Flows for Year 2

Cash Flows from Operating Acrivities

Inflow from Customers 105,000
Outflow from Expanses (35,000)
Net Cash Flow from Operating Activities 70,000
Cash Flows from Investing Activities 0
Cash Flows from Financing Activities 0
Net Change in Cash 70,000
Beginning Cash Balance 68,000
Ending Cash Balance 138,000