You decided to set up a business in collaboration with a friend in Dominica. Your friend agrees to buy 500ml bottles of pure tropical water from a local bottler and ship them to you in Toronto. Your friend receives a commission from the bottling company. The water is credited with giving Dominicans an exceptionally long life and there is an anticipated demand in the Toronto Caribbean community and from health food stores.On January 1, 2020 you rented industrial space for two years at $1,000 a month including utilities, with a $1,000 advance payment of the last month's rent. The same day you received an initial shipment of 10,000 bottles of water for which you paid your friend $2,000 by giving a money order to the delivery company. You reckon that you will be able to sell all these in the first month. You also have installed used furniture and fixtures costing $2,400 which will be worthless at the end of the second year and computing equipment costing $1,800 which will last about two years. Then you printed flyers using your computing equipment and have a local copy shop print for $500 a supply which you distributed during the first two weeks to local stores and restaurants.At the end of January, you are able to sell all 10,000 bottles for $0.75 a bottle.

In order to get your business started you borrowed $10,000 at 6% on January 1st.The loan must be repaid after one year and interest is payable immediately after the end of each month. You arrange for a bookkeeping service to keep accounting records for $100 per month. Miscellaneous other expenses are anticipated to be $100 per month.

create income statement for January 2020, Show all your calculations. Make any necessary assumptions.