A young engineer entrepreneur, wishing to start a manufacturing enterprise, approaches a leading commercial bank for financial assistance. The bank asks the entrepreneur to furnish forecasted financial statements. A summary of the expected (manufacturing and selling) transactions during the first year of operations is given. The student is required to prepare an estimated statement of assets, liabilities and capital and an estimated profit and loss statement. The case can be used to introduce the basic accounting concepts of cost, going concern and dual aspects. The distinction between cash and profit flows can also be shown.