The following selected accounts and their current balances appear in the ledger of Clairemont Co. for the fiscal year ended May 31, 2016:

Cash	$ 232,700
Accounts Receivable	957,000
Merchandise Inventory	1,668,600
Office Supplies	19,900
Prepaid Insurance	7,100
Office Equipment	827,000
Accumulated Depreciation-Office Equipment	547,000
Store Equipment	3,606,000
Accumulated Depreciation-Store Equipment	1,814,800
Accounts Payable	373,100
Salaries Payable	37,500
Note Payable (current portion)	48,000
Note Payable (final payment due 2022)	262,000
Common Stock	507,900
Retained Earnings	2,745,300
Dividends	92,700
Sales	11,429,500
Cost of Merchandise Sold	7,849,900
Sales Salaries Expense	896,500
Advertising Expense	542,100
Depreciation Expense-Store Equipment	141,000
Miscellaneous Selling Expense	28,500
Office Salaries Expense	646,400
Rent Expense	93,800
Depreciation Expense-Office Equipment	43,000
Insurance Expense	55,000
Office Supplies Expense	24,000
Miscellaneous Administrative Expense	9,200
Interest Expense	24,700

	Required:
1.	Prepare a multiple-step income statement. In the Other income and expenses section only, enter amounts that represent other expenses as negative numbers using a minus sign.*
2.	Prepare a retained earnings statement.*
3.	Prepare a report form of balance sheet. Less or Plus will automatically appear if it is required.*
4.	Briefly explain (a) how multiple-step and single-step income statements differ and (b) how report-form and account-form balance sheets differ.

* Be sure to complete the statement headings. Refer to the problem data and the list of Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries. A colon (:) will automatically appear if it is required.

Labels
Current assets
Current liabilities
For the Year Ended May 31, 2016
Long-term liabilities
May 31, 2016
Operating expenses
Other income and expense
Property, plant, and equipment
Amount Descriptions
Decrease in retained earnings
Gross profit
Income from operations
Increase in retained earnings
Less dividends
Net income
Net income for the year
Net loss
Net loss for the year
Plus dividends
Retained earnings, June 1, 2015
Retained earnings, May 31, 2016
Total administrative expenses
Total assets
Total current assets
Total current liabilities
Total liabilities
Total liabilities and stockholders equity
Total operating expenses
Total property, plant, and equipment
Total selling expenses
Total stockholders equity

Prepare a multiple-step income statement. Be sure to complete the statement heading. Refer to the problem data and the list of Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries. A colon (:) will automatically appear if it is required. In the Other income and expenses section only, enter amounts that represent other expenses as negative numbers using a minus sign.

Clairemont Company

Income Statement

1
2
3
4
5	Selling expenses:
6
7
8
9
10
11	Administrative expenses:
12
13
14
15
16
17
18
19
20
21
22
23

Prepare a retained earnings statement. Be sure to complete the statement heading. Refer to the list of Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries. A colon (:) will automatically appear if it is required.

Clairemont Company

Retained Earnings Statement

1
2
3
4
5

Prepare a report form of balance sheet. Be sure to complete the statement heading. Refer to the problem data and the list of Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries. A colon (:) will automatically appear if it is required. Less or Plus will automatically appear if it is required.

Clairemont Company

Balance Sheet

1	Assets
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16	Liabilities
17
18
19
20
21
22
23
24
25	Stockholders Equity
26
27
28
29

Briefly explain (a) how multiple-step and single-step income statements differ and (b) how report-form and account-form balance sheets differ.

(a) Which type of income statement shows intermediate balances?

Multiple-step

Single-step

(b) Which type of balance sheet presents assets, liabilities, and stockholders equity in a downward sequence?

Report form

Account form

The following selected accounts and their current balances appear in the ledger of Clairemont Co. for the fiscal year ended May 31, 2016: Cash $ 232,700 Accounts Receivable 957,000 Merchandise Inventory 1,668,600 Office Supplies 19,900 Prepaid Insurance 7,100 Office Equipment 827,000 Accumulated Depreciation-Office Equipment 547,000 Store Equipment 3,606,000 Accumulated Depreciation-Store Equipment 1,814,800 Accounts Payable 373,100 Salaries Payable 37,500 Note Payable (current portion) 48,000 Note Payable (final payment due 2022) 262,000 Common Stock 507,900 Retained Earnings 2,745,300 Dividends 92,700 Sales 11,429,500 Cost of Merchandise Sold 7,849,900 Sales Salaries Expense 896,500 Advertising Expense 542,100 Depreciation Expense-Store Equipment 141,000 Miscellaneous Selling Expense 28,500 Office Salaries Expense 646,400 Rent Expense 93,800 Depreciation Expense-Office Equipment 43,000 Insurance Expense 55,000 Office Supplies Expense 24,000 Miscellaneous Administrative Expense 9,200 Interest Expense 24,700 Required: 1. Prepare a multiple-step income statement. In the Other income and expenses section only, enter amounts that represent other expenses as negative numbers using a minus sign.* 2. Prepare a retained earnings statement.* 3. Prepare a report form of balance sheet. Less or Plus will automatically appear if it is required.* 4. Briefly explain (a) how multiple-step and single-step income statements differ and (b) how report-form and account-form balance sheets differ. * Be sure to complete the statement headings. Refer to the problem data and the list of Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries. A colon (:) will automatically appear if it is required. Labels Current assets Current liabilities For the Year Ended May 31, 2016 Long-term liabilities May 31, 2016 Operating expenses Other income and expense Property, plant, and equipment Amount Descriptions Decrease in retained earnings Gross profit Income from operations Increase in retained earnings Less dividends Net income Net income for the year Net loss Net loss for the year Plus dividends Retained earnings, June 1, 2015 Retained earnings, May 31, 2016 Total administrative expenses Total assets Total current assets Total current liabilities Total liabilities Total liabilities and stockholders equity Total operating expenses Total property, plant, and equipment Total selling expenses Total stockholders equity Prepare a multiple-step income statement. Be sure to complete the statement heading. Refer to the problem data and the list of Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries. A colon (:) will automatically appear if it is required. In the Other income and expenses section only, enter amounts that represent other expenses as negative numbers using a minus sign. Clairemont Company Income Statement 1 2 3 4 5 Selling expenses: 6 7 8 9 10 11 Administrative expenses: 12 13 14 15 16 17 18 19 20 21 22 23 Prepare a retained earnings statement. Be sure to complete the statement heading. Refer to the list of Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries. A colon (:) will automatically appear if it is required. Clairemont Company Retained Earnings Statement 1 2 3 4 5 Prepare a report form of balance sheet. Be sure to complete the statement heading. Refer to the problem data and the list of Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries. A colon (:) will automatically appear if it is required. Less or Plus will automatically appear if it is required. Clairemont Company Balance Sheet 1 Assets 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 Liabilities 17 18 19 20 21 22 23 24 25 Stockholders Equity 26 27 28 29 Briefly explain (a) how multiple-step and single-step income statements differ and (b) how report-form and account-form balance sheets differ. (a) Which type of income statement shows intermediate balances? Multiple-step Single-step (b) Which type of balance sheet presents assets, liabilities, and stockholders equity in a downward sequence? Report form Account form