Assignment task: The first step is administering you have a problem. Susie contemplated the implications of what she was about to say: "My name is Susie, and I'm a salsaholic." She looked in the mirror as if to see the metamorphosis brought about by her words. The change wasn't physical, it was spiritual. "AND, I'm starting a Salsa School!" She could see it now...she would teach beginning, intermediate and advanced classes. She could also do private lessons and would make herself available for private performances at local restaurants, fundraisers and parties. Susie was ready to live her dream. She picked up the phone and quit her job at Dairy Queen.
Over the course of the year, Susie saved $10,000 and secured a loan from her mom and dad for another $15,000 (mom and dad have agreed not to collect payments until month 7). Susie found a nice facility that she leased for $2000/month plus utilities of $350. She purchased mirrors $1500, Bose sound system $750, furniture $500, desk and chair $250, laptop computer $600, sofa $400, and an espresso machine $200. Susie also obtained a business license $50, fictious business name $50, website $200, iPhone $1200 (monthly service $125).
In her first month of operations Susie paid for one month's advertising in the Osider, $250 and incurred another expense, Chamber of Commerce dues, $300 (a one-:me expense). After ending her first chamber event, she recruited 10 new customers at $50 per month, her only students in her first month of operations.
Her second month in business was a little better. Susie added another 30 students to her academy and booked 2 performances at $250 each. She paid all of her monthly bills and paid herself $500.
In month three she lost 5 students but gained 10 more.
In month four she booked another 3 performances at $200 each.
Months five and six were very good. Susie books 4 performances during each month at $250 and added another 15 students to the Academy in month five, all remained for month six.
Required:
1. Create an opening day balance sheet.
2. Create an income statement and statement of owner's equity for each of the first 6 months of operations.
Assume any asset $399 or over belongs on the Balance Sheet.