Since you always dreamed of being an entrepreneur you opened a new company called "The Frozen Truck" on June 1st. Shortly thereafter, you got in touch with a company called "La Paleteria". This company manufactures paletas, a Mexican style popsicle with a smooth texture and made from real fruits. Since you loved this product so much you decided to commercialize paletas using a food truck during outdoor events. For this purpose your bank granted you a $5,000 loan. According the contract, the principal plus interest (calculated at 12% per year) have to be repaid in 6 months. Here are some transactions that occurred during your first month of operation (June):

- On June 1st, you signed a 2-year contract to lease a food truck for $200 per month. You had to pay the first two months up front.

- On the same date, you purchased a freezer for $2,400 cash. The estimated useful life is 20 years.

- You received $40 as a birthday gift from your grandmother. Feeling happy, you went to the movies with your partner.

- You purchased inventory from La Paleteria. The amount was put on account.

- You purchased gasoline for the food truck.

- During the month, you went to Coaticook and Sherbrooke to participate in different events. You sold 250 paletas at $5 each.

At the end of your first month of operation you were so excited that you decided to expand the company by hiring employees and purchasing more inventory. For this expansion you need another loan of $5,000. To evaluate your demand the bank manager asked you to prepare a financial report for June. Fortunately, you had followed the good advice given by your parents to keep all of your receipts and a copy of the cheques written during the month. The bank manager will use your report to decide if:

1) The bank will grant you an additional $5,000 loan

2) The bank will refuse your demand but continue business with you

3) The bank will recall the loan

Instructions:

- Prepare the financial report demanded by the bank.

- From the position of the bank manager, what decision should be made ?