The following selected accounts and their current balances appear in the ledger of Drapery Land Co. for the fiscal year ended July 31, 2010:

Instructions

1. Prepare a multiple-step income statement.

2. Prepare a statement of owner?s equity.

3. Prepare a report form of balance sheet, assuming that the current portion of the note payable is $16,800.

4. Briefly explain

(a) How multiple-step and single-step income statements differ and

(b) How report-form and account-form balance sheets differ.

Transcribed Image Text:

$ 161,250 $ 69,300 65,700 2,325,000 Cash Sales Returns and Allowances Accounts Receivable Merchandise Inventory Office Supplies Prepaid Insurance Office Equipment Accumulated Depreciation- Office Equipment Store Equipment Accumulated Depreciation- Store Equipment Accounts Payable Salaries Payable Note Payable (final payment due 2020) Tanya Xavier, Capital Tanya Xavier, Drawing 363,000 525,000 16,800 Sales Discounts Cost of Merchandise Sold Sales Salaries Expense Advertising Expense Depreciation Expense- Store Equipment Miscellaneous Selling Expense Office Salaries Expense 519,600 131,400 10,200 255,000 19,200 4,800 252,450 94,050 138,400 759,000 Rent Expense Depreciation Expense- Office Equipment Insurance Expense Office Supplies Expense Miscellaneous Administrative Expense Interest Expense 102,600 166,800 7,200 38,100 11,700 3,200 168,000 1,312,250 105,000 3,855,000 5,500 15,000 Sales