(Multiple- and Single-step Income, Retained Earnings) The following account balances were included in the trial balance of J.R. Reid Corporation at June 30, 2004. The Retained Earnings account had a balance of $337,000 at June 30, 2004, before closing. There are 80,000 shares of common stock outstanding.

(a) Using the multiple-step form, prepare an income statement and a retained earnings statement for the year ended June 30, 2004.

(b) Using the single-step form, prepare an income statement and a retained earnings statement for the year ended June 30,2004.

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Sales Sales discounts Cost of goods sold Sales salaries Sales commissions Travel expense-salespersons Freight-out Entertainment expense Telephone and Internet expense-sales Depreciation of sales equipment Building expense-prorated to sales Miscellaneous selling expenses Office supplies used Telephone and Internet expense- administration $1,678,500 31,150 896,770 56,260 97,600 28,930 21,400 14,820 9,030 4,980 6,200 4,715 3,450 2,820 Depreciation of office furniture and equipment Real estate and other local taxes Bad debt expense-selling Building expense-prorated to administration Miscellaneous office expenses Sales returns Dividends received Bond interest expense Income taxes Depreciation understatement due to error-2001 (net of tax) Dividends declared on preferred stock Dividends declared on common stock $ 7,250 7,320 4,850 9,130 6,000 62,300 38,000 18,000 133,000 17,700 9,000 32,000