Exercise $3-2$A $($Algo$)$ Comparing a merchandising company with a service company LO $3-1$

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

Borrowed $$94,500$ from the bank to start the business.

Provided $$63,000$ of services to clients and collected $$52,500$ cash

Paid salary expense of $$33,600.$

Data for Sports Clothing

Borrowed $$94,500$ from the bank to start the business.

Purchased $$63,000$ inventory for cash.

Inventory costing $$27,300$ was sold for $$52,500$ cash.

Paid $$8,400$ cash for operating expenses.

Required:

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