Boutique shoppe Ltd. began operations two years ago. Its adjusted account balances on December 31, 2019, are listed below:

Account

Debit

Credit

Cash

$11,300

Merchandise inventory

46,000

Store supplies

18,900

Notes receivable

8,500

Store equipment

167,600

Accumulated depreciation, store equipment

49,000

Mortgage payable

54,000

Accounts payable

30,500

Sales

450,000

Sales discounts

14,000

Sales returns and allowances

8,000

Cost of goods sold

126,400

Sales salaries expense

105,200

Rent expense, selling space

25,000

Office supplies expenses

1,800

Rent expense, office space

65,000

Advertising expense

42,600

John Hogan, capital

58,800

John Hogan, withdrawals

2,000

Totals

$642,300

$642,300

Required

1. Prepare a classified multi-step income statement for the year ended December 31, 2019. (10 marks).

2. Prepare a statement of changes in equity for the year ended December 31, 2019. (5 marks).

3. Prepare a classified balance sheet as on December 31, 2019 based on the information provided. (10 marks).