Exercise 13.1 Classifying income statement items. LO 13-1 The accounts listed below appear on the worksheet of Heritage Crafts. Indicate the section of the classified income statement in which each account will be reported. Accounts Section of Classified Income Statement Cost of goods sold Not reported 1. Purchases returns and allowances 2. Telephone expense 3. Sales returns and allowances 4. Purchases 5. Interest income 6. Merchandise inventory 7. Interest expense 8. Sales 9. Depreciation expense-Store equipment 10. Rent expense 11. Sales discounts 12. Supplies expense 13. Freight in 14. Purchase discounts 15. Uncollectible accounts expense Operating expenses Operating revenue Exercise 13.2 Classifying balance sheet items. LO 13-3 The following accounts appear on the worksheet of Heritage Crafts at December 31, 2019. Indicate the section of the classified balance sheet in which each account will be reported. Accounts Section of Classified Balance Sheet Current assets Current liabilities Long-term liabilities Not reported 1. Accounts receivable 2. Delivery van 3. Prepaid insurance 4. Notes payable, due 2025 5. Store supplies 6. Accounts payable 7. Merchandise inventory 8. David Stafford, Capital 9. Cash 10. Unearned subscriptions income 11. Notes receivable, due 2020 12. Accumulated depreciation-Delivery van 13. Notes payable, due 2020 14. David Stafford, Drawing 15. Interest payable