Exercise $4-1$A $($Algo$)$ Comparing a merchandising company with a service company LO $4-1$

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 $$99,900$ from the bank to start the business.

Provided $$66,600$ of services to clients and collected $$55,500$ cash.

Paid salary expense of $$35,520.$

Data for Sports Clothing

Borrowed $$99,900$ from the bank to start the business.

Purchased $$66,600$ inventory for cash.

Inventory costing $$28,860$ was sold for $$55,500$ cash.

Paid $$8,880$ cash for operating expenses.

Required

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