PART I: Prepare Cash Basis Statements In December 2018, Amanda and Teresa acquired B-ME, Inc. and began operating the company on January 1, 2019. The balance sheet as of December, 31 2018 was: B-ME, Inc. BALANCE SHEET As of December 31, 2018 ASSETS LIABILITIES & EQUITY Current Assets: Current Liabilities: Cash 5,000 Accounts Payable Inventory Supplies 18,000 23,000 Long-term Liabilities: Bank Loan 63,000 Long-term Assets: Building & Equipment 200,000 Equity: Land 40,000 240,000 200,000 0 200,000 Total Assets 263,000 Total Liabilities & Equity 263,000 Common Stock Retained Earnings B-ME, Inc. CASH RECEIPTS & EXPENDITURES FOR 2019 Cash Receipts: 221,800 Sales Total Cash Receipts 221,800 Cash Disbursements: Wages & Salaries Expense 75,500 Heat, Light & Power Expenses 6,000 More supplies (i.e. more Inventory 42,600 Selling & Administrative Expenses 18,275 Payment on Loan (Principal) 13,000 Interest Expense on Loan 3,150 158,525 Increase in Cash 63,275 Total Cash Disbursements In January 2020, Amanda and Teresa collected all their receipts/paid invoices and prepared their cash receipts & expenditures for 2019 (see chart) and posted them in Quick Books. They just hired Ryan as their new bookkeeper and asked him to prepare a Balance Sheet and Income Statement for 2019. Question: What should Ryan's Cash Basis Balance Sheet and Income Statement for 2019 look like? Remember: they made no accruals...just cash entries. YOUR ANSWER TO PART I: Cash Basis Financials for 2019 B-ME, Inc. BALANCE SHEET As of December 31, 2019 (Cash Basis) ASSETS Current Assets: Cash Inventory - Supplies Total Current Assets Long-term Assets: Building & Equipment Land Total Long-term Assets Total Assets LIABILITIES & EQUITY Current Liabilities: Accounts Payable Long-term Liabilities: Bank Loan Equity: Common Stock Retained Earnings Total Equity Total Liabilities & Equity 368,875 B-ME, Inc. INCOME STATEMENT For the Year Ended December 31, 2019 (Cash Basis) Sales Expenses: Total Expenses NET INCOME