1. Summary: Write a summary of what the financial statements indicate about the companys financial health and performance.
   1. Purpose: Discuss the accounting process and the resulting financial statements as they relate to meeting the informational needs of the user.
   2. Process: Explain the process used to produce accurate account balances and financial statements from the individual transaction data.
      1. Consider what is being communicated through each of the financial statements you prepared (income statement, statement of equity and balance sheet) and how this information will be used in business decision making and planning.
   3. Analysis: Explain the companys cash position, its net income as a percentage of sales, and its current liabilities to current assets position.
   4. Results: Discuss the results regarding profitability of the first month of operations.
      1. Consider how well the company is positioned to meet current liabilities.
      2. Be sure to include the percentage of revenues that result in profitet income and the current ratio when discussing profitability and liquidity based on the recorded months results.
      3. Consider key points in your observations of results: is the company operating profitably (what percent of revenues result in profitet income)? How well-poised are they to meet liabilities (discuss liquidity and current ratio)?
   5. Recommendations: Recommend a simple system of controls that can be implemented to ensure protection of company assets and the accuracy and integrity of their financial data as they anticipate further growth.
      1. Consider additional controls that will support the potential for adding merchandise and additional assets with business growth/expansion.
   6. Asset Valuation: Discuss the treatment of current and long-term assets on the balance sheet.
      1. Discuss at least two different methods of depreciation. Consider how the methods of depreciation will be determined.
      2. Discuss how LIFO, FIFO, and average methods will differ and provide examples of types of applicable merchandising.
      3. Consider how accounting will change with the addition of merchandise inventory.

A Company Income Statement For Month ending 06/30/20XX \begin{tabular}{|c|c|} \hline \multicolumn{2}{|l|}{ Revenues } \\ \hline Service Revenue & $5,525.00 \\ \hline Total Revenues & $5.525.00 \\ \hline \multicolumn{2}{|l|}{ Operating Expenses: } \\ \hline Rent Expense & $1,195.00 \\ \hline Business License Expense & $250.00 \\ \hline Telehone Expense & $155.00 \\ \hline Repair and Maintenance Expense & $210.00 \\ \hline Advertising Expense & $250.00 \\ \hline Wage Expense & $650.00 \\ \hline Depreciation Expense & $250.00 \\ \hline & \\ \hline Total Operating Expenses: & 2.960 .00 \\ \hline Net Income & 2.565 .00 \\ \hline \end{tabular} A Company Balance Sheet s of June 30,20x \begin{tabular}{|c|c|} \hline Assets & \\ \hline Current Assets: & \\ \hline Cash & 50,650.00 \\ \hline Accounts Receivable & 2,975.00 \\ \hline Prepaid Rent & 7,170.00 \\ \hline Prepaid Insurance & 750.00 \\ \hline Office Supplies & 750.00 \\ \hline Total Current & 52.295 .00 \\ \hline \end{tabular} Liabilities and Owners' Equitv Account Payable \begin{tabular}{|l|r|} \hline Account Payable & 155.00 \\ \hline Wages Payable & 325.00 \\ \hline Total Current Liabilities & 480.00 \\ \hline \end{tabular} Lonq Term Liabilities: Notes Payable 25,000.00 \begin{tabular}{l|r|} \hline Total Long Term Liabilities: & 25.000 .00 \\ \hline \end{tabular} \begin{tabular}{l|r|} \hline Total Liabilities: & 25.480 .00 \\ \hline \end{tabular} Owner's Equity Non-Current Assets: \begin{tabular}{|r|r|} \hline Vehicle & 15,000.00 \\ \hline Accumulated Depreciation & (250.00) \\ \hline Total Non Current/Fixed Assets & 14750.00 \\ \hline \end{tabular} \begin{tabular}{|l|r|} \hline & \\ \hline Owner's Capital & 51565 \\ \hline \multicolumn{2}{|l|}{} \\ \hline Total Equity & 51.565.00 \\ \hline \multicolumn{2}{|l|}{} \\ \hline Total Liabilities \& Equity & 77.045.00 \\ \hline \end{tabular} A Company Income Statement For Month ending 06/30/20XX \begin{tabular}{|c|c|} \hline \multicolumn{2}{|l|}{ Revenues } \\ \hline Service Revenue & $5,525.00 \\ \hline Total Revenues & $5.525.00 \\ \hline \multicolumn{2}{|l|}{ Operating Expenses: } \\ \hline Rent Expense & $1,195.00 \\ \hline Business License Expense & $250.00 \\ \hline Telehone Expense & $155.00 \\ \hline Repair and Maintenance Expense & $210.00 \\ \hline Advertising Expense & $250.00 \\ \hline Wage Expense & $650.00 \\ \hline Depreciation Expense & $250.00 \\ \hline & \\ \hline Total Operating Expenses: & 2.960 .00 \\ \hline Net Income & 2.565 .00 \\ \hline \end{tabular} A Company Balance Sheet s of June 30,20x \begin{tabular}{|c|c|} \hline Assets & \\ \hline Current Assets: & \\ \hline Cash & 50,650.00 \\ \hline Accounts Receivable & 2,975.00 \\ \hline Prepaid Rent & 7,170.00 \\ \hline Prepaid Insurance & 750.00 \\ \hline Office Supplies & 750.00 \\ \hline Total Current & 52.295 .00 \\ \hline \end{tabular} Liabilities and Owners' Equitv Account Payable \begin{tabular}{|l|r|} \hline Account Payable & 155.00 \\ \hline Wages Payable & 325.00 \\ \hline Total Current Liabilities & 480.00 \\ \hline \end{tabular} Lonq Term Liabilities: Notes Payable 25,000.00 \begin{tabular}{l|r|} \hline Total Long Term Liabilities: & 25.000 .00 \\ \hline \end{tabular} \begin{tabular}{l|r|} \hline Total Liabilities: & 25.480 .00 \\ \hline \end{tabular} Owner's Equity Non-Current Assets: \begin{tabular}{|r|r|} \hline Vehicle & 15,000.00 \\ \hline Accumulated Depreciation & (250.00) \\ \hline Total Non Current/Fixed Assets & 14750.00 \\ \hline \end{tabular} \begin{tabular}{|l|r|} \hline & \\ \hline Owner's Capital & 51565 \\ \hline \multicolumn{2}{|l|}{} \\ \hline Total Equity & 51.565.00 \\ \hline \multicolumn{2}{|l|}{} \\ \hline Total Liabilities \& Equity & 77.045.00 \\ \hline \end{tabular}