Problem 5-4A Computing merchandising amounts and formatting income statements LO C2, P4

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Valley Companys adjusted trial balance on August 31, 2013, its fiscal year-end, follows.

			Debit			Credit
Merchandise inventory		$	33,500
Other (noninventory) assets			134,000
Total liabilities					$	38,693
K. Valley, Capital						112,124
K. Valley, Withdrawals			8,000
Sales						229,140
Sales discounts			3,506
Sales returns and allowances			15,123
Cost of goods sold			89,129
Sales salaries expense			31,392
Rent expenseSelling space			10,770
Store supplies expense			2,750
Advertising expense			19,477
Office salaries expense			28,643
Rent expenseOffice space			2,750
Office supplies expense			917
Totals		$	379,957		$	379,957

On August 31, 2012, merchandise inventory was $27,035. Supplementary records of merchandising activities for the year ended August 31, 2013, reveal the following itemized costs.

Invoice cost of merchandise purchases	$	98,490
Purchase discounts received		2,068
Purchase returns and allowances		4,728
Costs of transportation-in		3,900

References

Section BreakProblem 5-4A Computing merchandising amounts and formatting income statements LO C2, P4

1.

value: 0.50 points

Required information

Problem 5-4A Part 1

Required:
1.	Compute the companys net sales for the year.

References

eBook & Resources

WorksheetDifficulty: MediumLearning Objective: 05-P4 Define and prepare multiple-step and single-step income statements.

Problem 5-4A Part 1Learning Objective: 05-C2 Identify and explain the inventory asset and cost flows of a merchandising company.

Check my work

2.

value: 0.50 points

Required information

Problem 5-4A Part 2

2.	Compute the companys total cost of merchandise purchased for the year.

References

eBook & Resources

WorksheetDifficulty: MediumLearning Objective: 05-P4 Define and prepare multiple-step and single-step income statements.

Problem 5-4A Part 2Learning Objective: 05-C2 Identify and explain the inventory asset and cost flows of a merchandising company.

Check my work

3.

value: 0.50 points

Required information

Problem 5-4A Part 3

3.	Prepare a multiple-step income statement that includes separate categories for selling expenses and for general and administrative expenses.

rev: 01_02_2014_QC_43145

References

eBook & Resources

WorksheetDifficulty: MediumLearning Objective: 05-P4 Define and prepare multiple-step and single-step income statements.

Problem 5-4A Part 3Learning Objective: 05-C2 Identify and explain the inventory asset and cost flows of a merchandising company.

Check my work

4.

value: 0.50 points

Required information

Problem 5-4A Part 4

4.	Prepare a single-step income statement that includes these expense categories: cost of goods sold, selling expenses, and general and administrative expenses.