Selected accounts from Murray€™s Furniture Store€™s adjusted trial balance as of June 30, 2014, the end of the fiscal year, follow.

Required
1. Prepare a multistep income statement for Murray€™s. Freight-In should be combined with Cost of Goods Sold. Store Salaries Expense, Advertising Expense, Store Supplies Expense, and Depreciation Expense€”Store Equipment are selling expenses. The other expenses are general and administrative expenses. The company uses the perpetual inventory system. Show details of net sales and operating expenses.
2. Based on your knowledge at this point in the course, how would you use Murray€™s income statement to evaluate the company€™s profitability? What other financial statement should you consider andwhy?

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Murray's Furniture Store Partial Adjusted Trial Balance June 30, 2014 Sales Sales Returns and Allowances Cost of Goods Sold Freight-In Store Salaries Expense Office Salaries Expense Advertising Expense Rent Expense Insurance Expense Utilities Expense Store Supplies Expense Office Supplies Expense Depreciation Expense-Store Equipment Depreciation Expense-Office Equipment 162,000 2,000 61,400 2,300 32,625 12,875 24,300 2400 1,200 1,560 2,880 1,175 1,050 800