The following selected accounts and their current balances appear in the ledger of Clairemont Co. for the fiscal year ended May 31, 20Y2:

Instructions

1. Prepare a multiple-step income statement.

2. Prepare a statement of stockholders’ equity. Additional common stock of $75,000 was issued during the year ended May 31, 20Y2.

3. Prepare a balance sheet, assuming that the current portion of the note payable is $50,000.

4. Briefly explain how multiple and single-step income statements differ.

Transcribed Image Text:

$ 240,000 $ 2,949,100 Cash Retained Earnings 100,000 Accounts Receivable 966,000 Dividends Sales Inventory 1,690,000 11,343,000 Estimated Returns Inventory 22,500 Cost of Goods Sold 7,850,000 Office Supplies Prepaid Insurance Office Equipment Sales Salaries Expense Advertising Expense 916,000 13,500 8,000 550,000 830,000 Depreciation Expense- Accumulated Depreciation- Office Equipment Store Equipment Accumulated Depreciation- Store Equipment Miscellaneous Selling Expense Office Salaries Expense 140,000 550,000 38,000 650,000 3,600,000 Rent Expense Depreciation Expense- Office Equipment 94,000 Store Equipment Accounts Payable Customer Refunds Payable Salaries Payable Note Payable (final payment due in 6 years) 1,820,000 326,000 50,000 48,000 40,000 Insurance Expense Office Supplies Expense Miscellaneous Administrative Exp. Interest Expense 28,100 41,500 14,500 300,000 21,000 Common Stock 500,000