On October 31, 2016, the balances of the accounts appearing in the ledger of Prestige Furnishings Company, a furniture wholesaler, are as follows:

Accumulated Depreciation-Building	$752,300
Administrative Expenses	540,650
Building	2,553,550
Cash	167,750
Common Stock	288,000
Cost of Merchandise Sold	3,899,650
Dividends	178,650
Interest Expense	10,150
Merchandise Inventory	1,006,950
Notes Payable	255,800
Office Supplies	20,400
Retained Earnings	1,304,450
Salaries Payable	7,600
Sales	6,477,150
Selling Expenses	684,100
Store Supplies	92,400

Required:

A.

Prepare a multiple-step income statement for the year ended October 31, 2016. Be sure to complete the statement heading. Refer to the information given in the exercise and to the list of Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries. A colon (:) will automatically appear if it is required. In the Other income and expenses section only, enter amounts that represent other expenses as negative numbers using a minus sign.

B.

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

Labels

For the Year Ended October 31, 2016

October 31, 2016

Operating expenses

Other income and expense

Amount Descriptions

Gross profit

Income from operations

Net income

Net loss

Total assets

Total liabilities

Total operating expenses

Total stockholders equity

. Prepare a multiple-step income statement for the year ended October 31, 2016. Be sure to complete the statement heading. Refer to the information given in the exercise and to the list of Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries. A colon (:) will automatically appear if it is required. In the Other income and expenses section only, enter amounts that represent other expenses as negative numbers using a minus sign.

Prestige Furnishings Company

Income Statement

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