• Complete the following problem
• Show calculations behind your answers where possible and explain your reasoning

Two accountants for the firm Elwes and Wright are arguing about the merits of presenting an income statement in a multiple-step versus a single-step format. The discussion involves the following 2020 information related to P. Bride Company ($000 omitted).

Administrative expense

Officers salaries $4,900

Depreciation of office furniture and equipment 3,960

Cost of goods sold 60,570

Rent revenue 17,230

Selling expense

Delivery expense 2,690

Sales commissions 7,980

Depreciation of sales equipment 6,480

Sales revenue 96,500

Income tax 9,070

Interest expense 1,860

Instructions:

1. Prepare an income statement for the year 2020 using the multiple-step form. Commons shares outstanding for 2020 total 40,550 (000 omitted).
2. Prepare an income statement for the year 2020 using the single-step form.
3. Which one do you prefer? Discuss.