Problem 3 Points 40 Murray's Mercantile completed the work sheet below for the year ended December 31, 20X1. Owner's equity as of January 1, 20X1, was $5,000. The current portion of Mortgage Payable is $500. REQUIRED: 1. Prepare a multiple-step income statement. 2. Prepare a statement of owner's equity 3. Prepare a balance sheet. WORK SHEET Trial Balance Debit Adjustments Adjusted Trial Balance Income Statement Debit Credit Balance Sheet Debit Account Title Credit Credit Debit Credit Gredit 1,020 2,640 4,220 440 3,800 1,020 2,640 1,020 2,640 4.430 Accounts Receivabk Merchandise Inventory Supplies Equipment Accum. Depr-Equipment Accounts Payable Wages Payable Mortgage Payable Murray, Capital Murray, Drawing ncome Summary Sales Sales Returns and Alowances Purchases 4430 4220 440 350 3,800 3,800 550 3,660 640 3,660 640 3,660 40 1,200 5,400 1,200 5,400 1,200 5,400 680 680 4,220 4430 4,220 4430 4,220 4,430 14,180 14,180 14,180 130 8,130 130 8,130 130 8,130 Purchases Retums and Allowances Purchases Discounts Freight-in Wages Expense Advertising Expense Supples Expense Utilities Expense Depr. Expense-Equipment Interest Expense 290 150 290 150 290 150 60 4,130 60 4,170 4,170 90 90 8,870 90 130 130 130 10 10 25430 25,430 8,870 29,990 29,990 2,92010,940 1,980 19,050 19,050 12,920 12,920 17,070 19,050 Net Income 1,980 Complete the Multi-step Income Statement on the next page; the statement has been started for you. (15 points for the Income Statement) Murray's Mercantile Income Statement for the year ended December 31, 20x1 Revenues from Sales Sales Cost of Goods Sold: Beginning Inventory Cost of Goods Sold Operating Expenses: Net Income 2. Complete a Statement of Owner's Equity using the format started for you: (10 points- Statement of Owner's Equity) Murray's Mercantile Statement of Owner's Equity As of December 31, 20x1 Murray, capital January 1, 20x1 3. Complete a Balance sheet using the format started for you: See next page... (15 points for the Balance sheet) Murray's Mercantile Balance Sheet ASSETS Liabilities: Owner's Equity