You have just created a corporation for your lemonade business.

The corporation initially has $100$ shares outstanding, all of which are owned by you.

To raise some capital, you go to a venture capitalist who's willing to invest $$25,000$ for $180$ newly issued shares.

You borrow another $$12,000$ from the bank, who charges an annual interest rate of $15\%.$

$3.$ Construct the balance sheet of your corporation after meeting with the bank. $(6$ points$)$

To get started, you need to buy some assets.

You buy some inventory, which will cost $$11,000$ and be replenished every year.

You also purchase one lemonade stand, which costs $$9,000$ and has a $5-$year life.

Assume straight$-$line depreciation.

$4.$ Construct the balance sheet of your corporation after purchasing the assets. $(6$ points$)$

Now, we are ready to operate. Here are our additional assumptions.

$($i$)$ Sales is $$24,000$ per year per stand.

$($ii$)$ Inventory cost is $$11,000$ per year per stand.

$($iii$)$ Labor cost is $$6,000$ per year per stand.

$($iv$)$ SGA cost is $$2,000$ per year per stand.

$($v$)$ R&D cost is $5\%$ of revenue per year.

$($vi$)$ Tax rate is $21\%.$

$5.$ Construct the income statement for your firm at year $1.(6$ points$)$

After the first year of operation, you go to the bank and borrow another $$25,000.$

You purchase your second lemonade stand.

You increase your inventory by another $$11,000.$

You don't sell additional equity or pay out any dividend.

$6.$ Construct the cash flow statement for your firm at the end of year $1.(6$ points$)$

$7.$ Construct your final balance sheet at the end of year $1.(6$ points$)$