Selected accounts from Keystone Furniture’s adjusted trial balance as of

Selected accounts from Keystone Furniture’s adjusted trial balance as of August 31, 2014, the end of the fiscal year, follow.


Selected accounts from Keystone Furniture’s adjusted trial balance as of


Required
1. Prepare a multistep income statement for Keystone. 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 the income statement for Keystone to evaluate the company’s profitability? What other financial statement should be considered, andwhy?

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