Baskin-Robbins is one of the world’s largest specialty ice cream shops. The company offers dozens of different flavors, from Very Berry Strawberry to lowfat Espresso ’n Cream. Assume that a local Baskin-Robbins in Raleigh, North Carolina, has the following amounts for the month of July 2024.

Required:
1. Prepare a multiple-step income statement for the month ended July 31, 2024.
2. Calculate the inventory turnover ratio for the month of July. Would you expect this ratio to be higher or lower in December 2024? Explain.
3. Calculate the gross profit ratio for the month of July.

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Salaries expense Inventory (July 1, 2024) Sales returns Utilities expense Income tax expense $13,700 2,300 1,100 3,600 6,000 Sales revenue Interest income Cost of goods sold Rent expense Interest expense Inventory (July 31, 2024) $69,800 3,300 28,700 6,700 400 1,100