On October 1, Lou Clark opened Tiger Restaurant, Inc. Clark is now at a crossroads. The October financial statement paint a glowing picture of the business, and Clark has asked you whether he should expand the business. To expand the business, Clark wants to be earning net income of $10,000 per month and have total assets of $50,000. Clark believes he is meeting both goals.

To start the business, Clark invested $25,000, not the $15,000 amount reported as Share capital on the Balance Sheet. The business issued $25,000 of shares to Clark. The bookkeeper plugged the $15,000Share capital amount into the Balance Sheet to make it balance. The bookkeeper made some other errors too. Clark shows you the following financial statements that the bookkeeper

prepared:

. Prepare corrected financial statements for Tiger Restaurant, Inc.: Income Statement, Statement of Changes in Equity, and Balance Sheet. Then, based on Clarks goals and your corrected statement, recommend to Clark whether he should expand the restaurant.

Tiger Restaurant, Inc. Income Statement Month Ended October 31, 20X7 2Revenues: Imvestments by owner Uneamed banquet sales revenue $25,000 5,000 4 $30,000 Expenses 7 Wages expense $6,000 $4,500 $3,000 $1,000 Kent expense 9Drvidends 101 Depreciation expense fixtures $14500 $15.500 12 Net income Tiger Restaurant, Inc. Balance Sheet October 31, 20X7 2 3 Cash 4 Prepaid insurance Assets Liabilities $8,000 Accounts payable $2,000 Sales revenue $9,000 $33,000 Accumulated depreciation-fixtures $1,000 $6,000 7 Cost of foods sold (expense) $12,500 Insurance expense $1,000 6 Food inventory 8 Fixtures (tables,chairs,etc.) 9 Dishes and silverware 10 $25,000 Owners'equity $4,000 Share captial $15,500 $58,500 $58,500