Income statement information for Flett Tire Repair Corporation for the year 2014 follows:

The effective tax rate on all income is 25%, and Flea applies ASPE.
Instructions
(a) Prepare a multiple-step income statement for 2014, showing expenses by function.
(b) Prepare a single-step income statement for 2014, showing expenses by nature.
(c) Discuss the merits of the two income statements, compared with each other.

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Freight-in Purchase discounts Dividend revenue Inventory (beginning) Sales returns and allowances Selling expenses: 14,000 10,000 20,000 120,000 15,000 Administrative expenses 39,000 28,500 9,500 137,000 50,000 5,500 600,000 930,000 9,000 Salaries and wages expense Depreciation expense-building Office supplies expense Inventory (ending) Loss-other (due to flood damage) Gain on the sale of equipment Purchases Sales revenue Interest expense Salaries and wages Depreciation expense-store equipment Store supplies expense 71,000 18,000 9,000