1. On March 31, 20Y4, the balances of the accounts appearing in the ledger of Danns Furnishings Company, a furniture wholesaler, are as follows:

   Accumulated DepreciationBuilding	$771,600		Merchandise Inventory	$952,550
   Administrative Expenses	549,350		Notes Payable	250,850
   Building	2,543,950		Office Supplies	19,400
   Cash	181,450		Salaries Payable	7,800
   Cost of Merchandise Sold	3,677,100		Sales	6,433,600
   Interest Expense	10,500		Selling Expenses	712,250
   Kathy Melman, Capital	1,643,400		Store Supplies	88,850
   Kathy Melman, Drawing	183,450

   a. Prepare a multiple-step income statement for the year ended March 31, 20Y4.

   Danns Furnishings Company Income Statement For the Year Ended March 31, 20Y4

   CashInterest expenseKathy Melman, DrawingSalesSales discounts		$- Select -
   BuildingCost of merchandise soldInterest expenseNotes payableOffice supplies		- Select -
   Gross profit		$fill in the blank 2bb668fddfbbfb4_5
   Expenses:
   Cost of merchandise soldKathy Melman, capitalKathy Melman, drawingSales discountsSelling expenses	$- Select -
   Administrative expensesBuildingCashOffice suppliesSalaries payable	- Select -
   Total expenses		fill in the blank 2bb668fddfbbfb4_10
   Income from operationsLoss from operations		$- Select -
   Other expense:
   Cost of merchandise soldInterest expenseKathy Melman, drawingSalaries payableSales		- Select -
   Net incomeNet loss		$- Select -

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

   The multiple-step income statement clearly presents the value of total revenues.The multiple-step income statement is less complex to prepare.The multiple-step income statement shows the relationship of gross profit to sales.The multiple-step income statement clearly presents the value of total expenses.