this is a question from accounting class. It should be done in Income statement formant. please help:
In the first year of operation, Bill paid for the following items:
Advertising $8,500
Textiles $60,000
Paint $6,000
Other supplies 3,000
Wages (for 1 intern) 12,000
Rent 12,000
Insurance (three-year policy) 3,000
Utilities 4,500
Miscellaneous expenses 1,500
Bill also purchased machinery for 15,000; He expects the machinery to be worthless after 5 years. Bill's utility bills for December 2012 have not arrived yet, but are expected to be $400. For 2012, Bill earned sales totaling $150,000 but only collected $ 130,000.
In addition, Bill has unused paint, other supplies and textile totaling $1,000, $500, and 15,000 respectively.
How much profit did Bill earn during his first year of business? Should he have kept his position at the shoe store making 40,000 a year?