TOYS 4 U Project Julianne has worked in a retail toy store for 8 years. Last year, Julianne's wages were $60,000. Lately, Julianne has been unhappy with the shop's owner. Convinced that she could run a toy store better at a lower cost, Julianne decided to go into business for herself and opened her own shop called Toys 4U on January 1st of the year. To get the business going, Julianne decided to invest heavily in advertising. She spent $10,000 on advertising aimed at consumers. Julianne also purchased computers, printers, and other equipment needed for her retail store for $6,000. She estimated that the equipment she purchased can be used for about five years before maintenance costs would be too high and they would need to be replaced. All equipment is estimated to be worth 10% of their original cost at the end of their life. At the end of the first year of business, Julianne had received $150,000 in cash from customers, of which $10,000 was cash paid in advance for pre-ordered toys. A review of Julianne's checkbook shows she paid the following (in addition to those mentioned previously) during A review of Julianne's checkbook shows she paid the following (in addition to those mentioned previously) during the first year of business: Toys Beginning Inventory, Jan 1 Supplies purchased Wages paid-part-time assistant Rent paid $70,000 8,000 12,500 12,000 12,000 3,200 1,500 1,000 Julianne's utility bill for the last month of the fiscal year was $150. She has not recorded the bill and plans to pay it in the next 30 days. At the end of the year, about $26,000 of toys inventory purchased during the year was in her store stock. In addition, $2,000 in supplies had not been used. Julianne's corporate income tax rate is 30%. Income Statement format should look as follows: "Name of Company" Income Statement "Period of Time Statement Covers" Sales - coGs = Gross Profit Operating Expenses: "Expense Account Name" "Expense Account Name' "Expense Account Name" "Expense Account Name" "Expense Account Name" "Expense Account Name" "Expense Account Name' "Expense Account Name' Total Expenses Income From Operations Income Tax Net Income At the end of the year, about $26,000 of toys inventory purchased during the year was in her store stock. In addition, $2,000 in supplies had not been used. Julianne's corporate income tax rate is 30%. Requirement 1 (20 points) - Prepare an income statement for Toys 4U for the fiscal year ended December 31,2023 in proper form (see sample of proper form below). Requirement 2 (10 points) - Write a memo to Julianne stating whether you think it was a good idea for her to open the Toy shop or if she should have stayed employed at her old job. State your reasons for your opinion. Do you have any recommendations for Julianne? Your memo should be at least 1 page, double spaced, and 12-point font. You may attach 2 separate files for the requirements above or combine both the income statement and written memo into 1 document. Acceptable file formats are Excel or Word. Income Statement format should look as follows
