The following information is available for two different types of businesses for the 2018 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

Borrowed $38,000 from the bank to start the business.

Provided $40,000 of services to clients and collected $40,000 cash.

Paid salary expense of $25,600.

Data for Sports Clothing

Borrowed $38,000 from the bank to start the business.

Purchased $29,000 inventory for cash.

Inventory costing $24,400 was sold for $44,000 cash.

Paid $3,500 cash for operating expenses.

Required

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