Multiple$-$step income statement

On March $31,20$Y$9,$ the balances of the accounts appearing in the ledger of Royal Furnishings Company, a furniture store, are as follows:

Line Item Description Amount

Accounts Receivable $$170,000$

Accumulated Depreciation$$Building $750,250$

Administrative Expenses $540,700$

Building $2,501,100$

Cash $167,200$

Common Stock $297,500$

Cost of Goods Sold $3,916,700$

Dividends $166,450$

Interest Expense $10,000$

Inventory $$940,000$

Notes Payable $279,700$

Office Supplies $19,850$

Retained Earnings $1,245,500$

Salaries Payable $7,700$

Sales $6,668,300$

Selling Expenses $682,400$

Store Supplies $89,550$

Question Content Area

a$.$ Prepare a multiple$-$step income statement for the fiscal year ended March $31,20$Y$9.$

Royal Furnishings Company

Income Statement

For the Year Ended March $31,20$Y$9$

Line Item Description Amount Amount

$$-$ Select $-$

$-$ Select $-$

Gross profit $Gross profit

Expenses:

$$-$ Select $-$

$-$ Select $-$

Total expenses Total expenses

$$-$ Select $-$

Other revenue and expense:

$-$ Select $-$

$$-$ Select $-$

Question Content Area

b$.$ What is a major advantage of the multiple$-$step income statement over the single$-$step income statement?

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