Effect on the accounting equation of sales (made with discounts terms and sales tax) and purchases of inventory Differences between a single-step and multi-step income statement and the advantages and disadvantages of each. Single step income statement emphasizes total revenues and total expenses in determining net income. O Advantages: o Disadvantages: Gross profit and operating income not reported Multi step income statement: form of income statement that contains several sections, subsections, and subtotals o Advantages: o Disadvantages