3 Prepare a multiplestep income statement that includes sepa

3. Prepare a multiple-step income statement that includes separate categories for selling expenses and for general and administrative expenses. VALLEY COMPANY Income Statement For Year Ended August 31, 2015 Expense Selling expenses Total selling expenses General and administrative expenses Total general and administrative expenses Total expenses

Solution

Valley Company multi Income Statement For the year ended August 31, 2015 Sales Revenue Sales $ 249,660 Less: Sales Return and allowances $ 16,478 Less: Sales Discounts $    3,820 $    20,298 Net Sales Revenue $ 229,362 Cost of goods sold $    96,761 Gross Profit $ 132,601 Expenses Selling expenses Sales salaries expense $ 34,203 Rent expense - selling space $ 11,734 Store supplies expense $    2,996 Advertising expense $ 21,221 Total selling expenses $ 70,154 General and administrative expense Office salaries expense $ 31,208 Rent expense - office space $    2,996 Office supplies expense $        999 Total general and administrative expenses $ 35,203 Total expenses $ 105,357 Net Income $    27,244