Valley Company's adjusted trial balance on August 31, 2013, its fiscal year end, follows.
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On August 31, 2012, merchandise inventory was $ 25,400. Supplementary records of merchandising activities for the year ended August 31, 2013, reveal the following itemized costs.
Invoice cost of merchandise purchases . . . . . . . . $ 92,000
Purchase discounts received . . . . . . . . . . . . . . . . . 2,000
Purchase returns and allowances . . . . . . . . . . . . . 4,500
Costs of transportation in . . . . . . . . . . . . . . . . . . 4,600
Required:
1. Compute the company's net sales for the year.
2. Compute the company's total cost of merchandise purchased for the year.
3. Prepare a multiple step income statement that includes separate categories for selling expenses and for general and administrative expenses.
4. Prepare a single step income statement that includes these expense categories: cost of goods sold, selling expenses, and general and administrativeexpenses.