Problem 4-3A Computing merchandising amounts and formatting income statements LO A2, C2, P4 Valley Company's adjusted trial balance on August 31, 2018, its fiscal year-end, follows. Debit Credit Merchandise inventory $ 41,000 Other (non inventory) assets 130,400 Total liabilities $ 25,000 Common stock 10,000 Retained earnings 94,550 Dividends 8,000 Sales 225,600 Sales discounts 2.250 Sales returns and allowances 12,000 Cost of goods sold 74,500 Sales salaries expense 32,000 Rent expense-Selling space 8,000 Store supplies expense 1,500 Advertising expense 13,000 office salaries expense 28,500 Rent expense-office space 3,680 Office supplies expense 400 Totals $355,150 $355, 150 Inn On August 31, 2017, merchandise inventory was $25,400 Supplementary records of merchandising activities for the year ended August 31, 2018, reveal the following itemized costs. Invoice cost of merchandise purchases Purchases discounts received Purchases returns and allowances Costs of transportation in $92,000 2,000 4,500 4,600 Required: 1. Prepare a multiple-step income statement that includes separate categories for net sales, cost of goods sold, selling expenses, and general and administrative expenses. 2. Compute the company's gross margin ratio Invoice cost of merchandise purchases Purchases discounts received Purchases returns and allowances Costs of transportation-in $92,000 2,000 4,500 4,600 Required: 1. Prepare a multiple-step Income statement that includes separate categories for net sales, cost of goods sold, selling expenses, and general and administrative expenses. 2. Compute the company's gross margin ratio. Complete this questions by entering your answers in the below tabs. Required 1 Required 2 Compute the company's gross margin ratio. Round the percentage to one decimal place (e.g. 17.8%). Gross margin ratio %