The following selected accounts and their current balances appear in the ledger of Clairemont Co$.$ for the fiscal year ended May $31,20$Y$2$:

Cash $$240,000$

Accounts Receivable $966,000$

Inventory $1,690,000$

Estimated Returns Inventory $22,500$

Office Supplies $13,500$

Prepaid Insurance $8,000$

Office Equipment $830,000$

Accumulated Depreciation$$Office Equipment $550,000$

Store Equipment $3,600,000$

Accumulated Depreciation$$Store Equipment $1,820,000$

Accounts Payable $326,000$

Customer Refunds Payable $40,000$

Salaries Payable $41,500$

Note Payable $($final payment due in $6$ years$)300,000$

Common Stock $500,000$

Retained Earnings $$2,949,100$

Dividends $100,000$

Sales $11,343,000$

Cost of Goods Sold $7,850,000$

Sales Salaries Expense $916,000$

Advertising Expense $550,000$

Depreciation Expense$$Store Equipment $140,000$

Miscellaneous Selling Expense $38,000$

Office Salaries Expense $650,000$

Rent Expense $94,000$

Depreciation Expense$$Office Equipment $50,000$

Insurance Expense $48,000$

Office Supplies Expense $28,100$

Miscellaneous Administrative Exp. $14,500$

Interest Expense $21,000$

INSTRUCTIONS

Prepare a multiple$-$step income statement.

SHOW ANSWER

Prepare a statement of stockholders$$ equity. Additional common stock of $$75,000$ was issued during the year ended May $31,20$Y$2.$

Prepare a balance sheet, assuming that the current portion of the note payable is $$50,000.$

Briefly explain how multiple and single$-$step income statements differ.