On July 31, 2012, the balances of the accounts appearing in the ledger of Vagabond Furnishings Company, a furniture wholesaler, are as follows:

a. Prepare a multiple-step income statement for the year ended July 31, 2012.
b. Compare the major advantages and disadvantages of the multiple-step and single-step forms of incomestatements.

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$21,200 937,600 6,000 3,200,000 Administrative Expenses Building Capital Stock Cash Cost of Merchandise Sold Dividends Interest Expense Merchandise Inventory Notes Payable 250,000 Office Supplies 1,234,000 Retained Earnings 200,000 Salaries Payable 97,000 Sales 1,700,000 Sales Discounts 60,000 50,000 Sales Returns and Allowances 90,000 410,000 15,400 15,000 Selling Expenses 360,000 Store Supplies 59,000