Jim’s Bike Shop sells and repairs bicycles. The owner, Jim Hardy, took several accounting courses in college and has decided to maintain his business’s accounting records. Although the shop has been in operation for longer than three months, Hardy has not yet prepared any ﬁnancial statements for the business. Although several of Hardy’s friends who are business owners prepare monthly ﬁnancial statements for their businesses, Hardy has decided that it is too much of a hassle to prepare monthly ﬁnancial statements for Jim’s Bike Shop.
Write a memo to Hardy explaining why ﬁnancial statements would help him operate his business more efficiently and effectively.