Stacy, a longtime friend of yours, has had a passion for baking as long as you've known her. She has recently come into an inheritance, and is investigating the possibility of opening her own bakery. After you inform her that you are taking an accounting class, she asks for your advice on several issues. Draft a letter to Stacy addressing the following issues:

- What form of business organization - proprietorship, partnership, or corporation - do you recommend Stacy use for her business? Discuss the benefits and weaknesses of each form she may consider.

- Will Stacy need accounting information? If yes, what information will she need and why?

- Identify the different financial statements that Stacy will need to prepare for the business, and the purpose of each of the statements.