uvi, Inc. began business on January 1, 2012 by selling five (5) shares of common stock for $1 each. The firm earned $4 in consulting revenue and collected its fee in cash during January. uvi incurred $3 of operating expenses in January, but the company will pay for these operating expenses in February.

Required: Prepare uvi income statement for January 2012 and the balance sheet on January 31, 2012 in the spaces provided below. Be sure to report net income from the income statement as retained earnings on the balance sheet.

uvi Inc.

Income Statement

January 1-January 31, 2012

uvi Inc.

Balance Sheet

January 31, 2012