Greenway Corporation is organized on June 1, 2008. The company will provide lawn-care and tree-trimming services on a contract basis. Following is an alphabetical list of the items that should appear on its income statement for the first month and on its balance sheet at the end of the first month.

Required 

1. Prepare an income statement for the month of June. 

2. Prepare a balance sheet at June 30, 2008. You will need to determine the balance in Retained Earnings at the end of the month. 

3. The financial statements you have just prepared are helpful; but in many ways, they are a starting point. Assuming that this is your business, what additional questions do the financial statements raise that you need to consider?

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Accounts payable Accounts receivable $ 800 500 Building 2,000 Capital stock 5,000 Cash 3,300 Gas, utilities, and other expenses 300 Land 4,000 Lawn-care revenue 1,500 Notes payable 6,000 Retained earnings (beginning balance) 0 Salaries and wages expense 900 Tools 800 Tree-trimming revenue 500 Truck 2,000