Prepare journal entries to record the following merchandising transactions of Lowe's, which uses the perpetual inventory system and the gross method. August 1 Purchased merchandise from Aron Company for $8,000 under credit termis of 1/10,n/30, foe destination, invoice dated August 1 . August 5 Sold merchandise to Baird corporation for $5,600 under credit terss of 2/10,n/60,f08 destination, invoice dated August 5. The merchandise had cost $4,600. August 8 Purchased nerchandise fron Waters Corporation for $7,000 under credit terms of 1/10,n/45, FOB shipping point, invoice dated August 8. August 9 Poid $190 cash for shipping charges related to the August 5 sale to Baird Corporation. August 10 Baird returned merchandise from the August 5 sale that had cost Lowe's $500 and was sold for $1,600. The merchandise was restored to inventory. August 12 After negotiations with waters Corporation concerning problems with the purchases on August 8 , Lowe's received a price reduction from katers of $700 off the $7,000 of goods purchased. Lowe's debited accounts payable for $760. August 14 At Aron's request, Lowe's pald 5160 cash for freight charges on the August 1 purchase, reducing the amount oned (accounts August 15 Recelved balance due from Baird Corporation for the August 5 sole less the return on August 10. August 18 Paid the amount due Waters Corporation for the August B purchase less the price ollowance fron August 12. August 19 Sold merchandise to Tux Company for $4,800 under credit terns of n/10, FoB shipping point, invaice dated August 19. The merchandise had cost $2,400. August 22 Tur requested a price reduction on the August is sale because the merchandise did not meet specifications. Lowe's gave a price reduction (allowance) of s60e to Tux and credited Tux's accounts recelvable for that amount. August 29 Recelved Tux's cash payment for the amount due from the August 19 sale less the price allowance from August 22. August 30 Pald Aron Conpany the amount due from the August 1 purchase. Valley Company's adjusted account balances from its general ledger on August 31 , its fiscal year-end, follows. It categorizes the following accounts as selling expenses: sales salaries expense, rent expense-selling space, store supplies expense, and advertising expense. It categorizes the remaining expenses as general and administrative. Beginning merchandise inventory was $32,280. Supplementary records of merchandising activities for the year ended August 31 reveal the following itemized costs. Required: 1. Compute the company's net sales for the year. 2. Compute the company's total cost of merchandise purchased for the year. 3. Prepare a multipie-step income statement that includes separate categories for net sales, cost of goods sold, selling expense: and general and administrative expenses. 4. Prepare a single-step income statement that includes these expense categories: cost of goods sold, selling expenses, and general and administrative expenses