Valley Companys adjusted trial balance on August 31, its fiscal year-end, follows. It categorizes the following accounts as selling expenses: sales salaries expense, rent expenseselling space, store supplies expense, advertising expense. It categorizes the remaining expenses as general and administrative.

		Debit			Credit
Merchandise inventory (ending)		$	44,500
Other (noninventory) assets			178,000
Total liabilities					$	51,398
K. Valley, Capital						145,033
K. Valley, Withdrawals			8,000
Sales						304,380
Sales discounts			4,657
Sales returns and allowances			20,089
Cost of goods sold			117,115
Sales salaries expense			41,700
Rent expenseSelling space			14,306
Store supplies expense			3,653
Advertising expense			25,872
Office salaries expense			38,048
Rent expenseOffice space			3,653
Office supplies expense			1,218
Totals		$	500,811		$	500,811

Beginning merchandise inventory was $35,912. Supplementary records of merchandising activities for the year ended August 31 reveal the following itemized costs.

Invoice cost of merchandise purchases	$	130,830
Purchases discounts received		2,747
Purchases returns and allowances		6,280
Costs of transportation-in		3,900

Required:

1. Compute the companys net sales for the year. 2. Compute the companys total cost of merchandise purchased for the year. 3. Prepare a multiple-step income statement that includes separate categories for net sales, cost of goods sold, selling expenses, and general and administrative expenses. 4. Prepare a single-step income statement that includes these expense categories: cost of goods sold, selling expenses, and general and administrative expenses.

Net Sales
Sales
Net sales

Cost of Merchandise Purchased
Invoice cost of merchandise purchased
Purchase discounts received
Purchase returns and allowances
Costs of transportation-in
Total cost of merchandise purchased

Prepare a multiple-step income statement that includes separate categories for net sales, cost of goods sold, selling expenses, and general and administrative expenses.

VALLEY COMPANY
Income Statement
For Year Ended August 31
Expense
Selling expenses
Total selling expenses
General and administrative expenses
Total general and administrative expenses
Total expenses

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

VALLEY COMPANY
Income Statement
For Year Ended August 31
Expenses
Total expenses