1. List the accounts of a merchandising company which employs a perpetual inventory system that will not appear in the financial statements of a service company. When listing the account names, indicate if it appears on the Income Statement or on the Balance Sheet..
2. Explain what sales discounts and a purchase discounts are. What account will a buyer credit for the amount of the purchase discount.
3. Why would a financial statement user prefer a multiple-step income statement instead of a single-step income statement.