The Cherry & White Bike Company is a small closely-held company with two owners. Its two owners, Charlotte and George, have decided to expand the business. You are CWB's accountant. Your responsibilities include maintaining all accounting records and preparing annual financial statements. Cherry & White Bikes' started on January 2, 2017. CWB's year end is December 31st. CWB wants to take out a loan to expand its business in the coming year. The banks and lending institutions require a set of financial statements prepared under U.S. GAAP to evaluate CWB's credit worthiness. - You must prepare a complete set of financial statements including the notes to the financial statements for the period ending December 31, 2017. You need to choose CWB's accounting policies and methods for areas including inventory cost flow, revenue recognition, and depreciation. You will need to consider the proper classification of assets and liabilities as current and non-current on the balance sheet. - To obtain a loan with the lowest interest rate available, CWB company needs to show high profitability, and strong liquidity and solvency. You realize the common financial statement analysis ratios for profitability, solvency and liquidity will depend on the accounting methods you choose. So, you carefully analyze the accounting choices in light of common financial statement ratios. - The owners also have expressed to you that they need to know their inventory and cost of goods sold to manage purchases and pricing. So, you are highly considering using a perpetual inventory system. You have a trial balance and must add the additional transactions and activities identified below. You can add accounts to the trial balance, as needed. Cherry & White Bikes had the following additional transactions The owners hire Lisa Marton to manage the store, paying her a salary of $3,000 a month. Lisa is paid on the 1st of every month, starting on July 1. - June 1: July 1: Installed new light fixtures and display cases in the leased store. CWB paid $1,800 for the fixtures, $230 for shipping to the store, and $800 to an electrician to install. The landlord gave CWB permission to remove and dispose of the old fixtures. CWB sold the old fixtures for $110. CWB anticipates being in the store for at least 3 years. CWB cannot take the light fixtures with them if they relocate as they will revert to the lessor. CWB can take the display cases, which cost $6,400, if they move. Both the display cases and light-fixtures have a six-year useful life. - CWB invests $2,000 in an 18-month certificate of deposit paying interest of 1.5%. August 1