Valley Company's adjusted trial balance on August 31, 2013, its fiscal year-end, follows.
| Merchandise inventory |
|
$ |
36,000 |
|
|
|
|
| Other (noninventory) assets |
|
|
144,000 |
|
|
|
|
| Total liabilities |
|
|
|
|
$ |
41,580 |
|
| K. Valley, Capital |
|
|
|
|
|
119,601 |
|
| K. Valley, Withdrawals |
|
|
8,000 |
|
|
|
|
| Sales |
|
|
|
|
|
246,240 |
|
| Sales discounts |
|
|
3,767 |
|
|
|
|
| Sales returns and allowances |
|
|
16,252 |
|
|
|
|
| Cost of goods sold |
|
|
95,489 |
|
|
|
|
| Sales salaries expense |
|
|
33,735 |
|
|
|
|
| Rent expense-Selling space |
|
|
11,573 |
|
|
|
|
| Store supplies expense |
|
|
2,955 |
|
|
|
|
| Advertising expense |
|
|
20,930 |
|
|
|
|
| Office salaries expense |
|
|
30,780 |
|
|
|
|
| Rent expense-Office space |
|
|
2,955 |
|
|
|
|
| Office supplies expense |
|
|
985 |
|
|
|
|
|
|
|
|
|
|
|
|
| Totals |
|
$ |
407,421 |
|
$ |
407,421
|
On August 31, 2012, merchandise inventory was $29,052. Supplementary records of merchandising activities for the year ended August 31, 2013, reveal the following itemized costs.
Invoice cost of merchandise purchases$105,840
Purchase discounts received 2,223
Purchase returns and allowances 5,080
Costs of transportation-in 3,900
A) Compute the company's net sales for the year.
B) Prepare a multiple-step income statement that includes separate categories for selling expenses and for general and administrative expenses.
C) Prepare a single-step income statement that includes these expense categories: cost of goods sold, selling expenses, and general and administrative expenses.