The following information is available for two different types of businesses for the Year 1 accounting year. Hopkins CPAs is a service business that provides accounting services to small businesses. Sports Clothing is a merchandising business that sells sports clothing to college students.

Data for Hopkins CPAs

1. Borrowed $42,000 from the bank to start the business.
2. Provided $32,000 of services to clients and collected $32,000 cash.
3. Paid salary expense of $20,500.

Data for Sports Clothing

1. Borrowed $42,000 from the bank to start the business.
2. Purchased $21,000 inventory for cash.
3. Inventory costing $17,600 was sold for $32,000 cash.
4. Paid $2,600 cash for operating expenses.

Required:

a. Prepare an income statement, balance sheet, and statement of cash flows for each of the companies.