On October 1, 2014, Mark Brandford opened Mark€™s Coffee Shop, Inc. Brandford is now at a crossroads. The October financial statements paint a glowing picture of the business, and Brandford has asked you whether he should expand the business. To expand the business, Brandford wants to be earning net income of $10,000 per month and have total assets of $50,000. Brandford believes he is meeting both goals. To start the business, Brandford invested $25,000, not the $15,000 amount reported as €œCommon stock€ on the balance sheet. The business issued $25,000 of common stock to Brandford. The bookkeeper €œplugged€ the $15,000 €œCommon stock€ amount into the balance sheet (entered the amount necessary without any support) to make it balance. The bookkeeper made some other errors too. Brandford shows you the following financial statements that the bookkeeper prepared:

Requirement
1. Prepare corrected financial statements for Mark€™s Coffee Shop, Inc.: single step Income Statement, Statement of Retained Earnings, and Balance Sheet. Then, based on Brandford€™s goals and your corrected statements, recommend to Brandford whether he should expand therestaurant.

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A1 Mark's Coffee Shop Income Statement Month ended October 31, 2014 Revenue Investments by owner $25,000 $28,000 Expenses 7Wages expense Rent expense Dividends $5,000 4,000 3,000 12 Net Income A1 Mark's Coffee Shop Balance Sheet October 31, 2014 Assets iabilities $7,000 32,000 3 Cash $8,000 Accounts payable Prepaid insurance Insurance expense Food inventory 1,000 Sales revenue 1,000 Accumulated depreciation- 5,000 fixtures 12,000 7. Cost of goods sold (expense) I - Fixtures tables, chairs, etc.)2000 Stoholder Equitry40.00 Fxstables, chairs, etc.) 15,000 9Dishes and silverware 10 4,000 Common stock $55,000