1. Use the data in Problem 5-14A to prepare Marchand Distributors' multi-step income statement for the year ended May 31, 2017.

2. Corry Marchand, owner of the company, strives to earn a gross margin of at least 50 percent and a net income of 20 percent (Net income percentage = Net income ÷ Net sales revenue). Did Marchand Distributors achieve these goals? Show your calculations.

In Problem 5-14A

Items from the accounts of Marchand Distributors at May 31, 2017, follow, listed in alphabetical order. Marchand Distributors uses the periodic inventory system. For simplicity, all operating expenses are summarized in the General Expenses and the Selling Expenses account.

Accounts Payable $ 71,000 Inventory May 31, 2016 $ 151,800 107,500 Notes Payable Long-Term 114,800 1,102,200 7,200 26,500 Accumulated Amortization_ Equipment 96,900 Purchases C.Marchand, Capita!.. 167,800 Salaries Payable 66,900 Sales Discounts 19,900 Sales Returns and 340,800 Allowances 206,800 Sales Revenue Equipment General Expenses Interest Expense Interest Payable Interest Revenue 45,900 1,991,500 357,200 33,100 15,200 9,200 Selling Expenses 2,800 Supplies