financial statements:

plz help

5) What percentage (higher percentage or a lower percentage) would you use for the benchmark you selected in Q5 above? (Pick an actual percentage ex: 5% or 1%, or 10%, based on the guidance below.) (EX: 5% of Net Income vs 10% of Net Income)? Explain why? Your choice should be based on the Inherent risk and control risk determined in questions 1-4 above. [Click on one of the boxes below to select your answer, check only one box.) O a. 5 percent of net income before taxes. O b. 10 percent of net income before taxes. I c. X percent of total assets. O d. 1 percent of total assets. O e. X percent of total revenues. O 1.1 percent of total revenues. I g. 1 percent of total equity. I h. Less than 1 percent of total Equity Statement of Financial Condition y Edi December 31, 2020 S Assets Cash and cash equivalents Inventories Property Plan & Equipment (Net of Accum. Repr. Of $1,700,000) Accounts receivable (Net of $1,124,280 allowance for uncollectible Accts.) Other assets 1.741,204 6,500,042 3,710,753 4,718,517 1,175,094 Total assets $ 17,485,610 Liabilities and Member's Equity Liabilities: Notes Payable Accounts payable and accrued expenses Long Term Debt Total liabilities Stockholder's Equity: Common Stock (no Par Stock, 1 million shares outstanding) Retained Earnings Total Stockholder's Equity 5, 139,690 180,579 5,000,000 10,320, 269 4,496,341 3.029,000 7,525,341 Total liabilities and Stockholder's equity S 17,485,610 Frated State et Pe etibilitin erigata Bar Virtual Reality, Inc. Statement of Operations Year ended December 31, 2020 Revenues Technology Income (Net of Sales Returns and Discounts) Dividend and Interest Income Other revenue Total Revenues $ 30,174,531 10,597 4,159 30,189,287 Expenses Cost of Goods Sold Fees to Parent for rent, staff, etc. Legal, professional, audit, and regulatory fees Salary Expense Interest expense Depreciation & Amortization expense Other expenses otal Expenses Settlement expense (from lawsuit) 15,832,849 1,200,000 207,398 1,014,336 15,526 70,000 65.646 18,405,755 1,000,000 Net Income s 10,783,532 5) What percentage (higher percentage or a lower percentage) would you use for the benchmark you selected in Q5 above? (Pick an actual percentage ex: 5% or 1%, or 10%, based on the guidance below.) (EX: 5% of Net Income vs 10% of Net Income)? Explain why? Your choice should be based on the Inherent risk and control risk determined in questions 1-4 above. [Click on one of the boxes below to select your answer, check only one box.) O a. 5 percent of net income before taxes. O b. 10 percent of net income before taxes. I c. X percent of total assets. O d. 1 percent of total assets. O e. X percent of total revenues. O 1.1 percent of total revenues. I g. 1 percent of total equity. I h. Less than 1 percent of total Equity Statement of Financial Condition y Edi December 31, 2020 S Assets Cash and cash equivalents Inventories Property Plan & Equipment (Net of Accum. Repr. Of $1,700,000) Accounts receivable (Net of $1,124,280 allowance for uncollectible Accts.) Other assets 1.741,204 6,500,042 3,710,753 4,718,517 1,175,094 Total assets $ 17,485,610 Liabilities and Member's Equity Liabilities: Notes Payable Accounts payable and accrued expenses Long Term Debt Total liabilities Stockholder's Equity: Common Stock (no Par Stock, 1 million shares outstanding) Retained Earnings Total Stockholder's Equity 5, 139,690 180,579 5,000,000 10,320, 269 4,496,341 3.029,000 7,525,341 Total liabilities and Stockholder's equity S 17,485,610 Frated State et Pe etibilitin erigata Bar Virtual Reality, Inc. Statement of Operations Year ended December 31, 2020 Revenues Technology Income (Net of Sales Returns and Discounts) Dividend and Interest Income Other revenue Total Revenues $ 30,174,531 10,597 4,159 30,189,287 Expenses Cost of Goods Sold Fees to Parent for rent, staff, etc. Legal, professional, audit, and regulatory fees Salary Expense Interest expense Depreciation & Amortization expense Other expenses otal Expenses Settlement expense (from lawsuit) 15,832,849 1,200,000 207,398 1,014,336 15,526 70,000 65.646 18,405,755 1,000,000 Net Income s 10,783,532