1.

Prepare a multistep income statement that would be used for internal reporting purposes. Treat Sales Discounts and Sales Returns and Allowances as contra-revenue accounts. TIP: Some of the accounts listed will appear on the balance sheet rather than the income statement.

2.

Prepare a multistep income statement that would be used for external reporting purposes, beginning with the amount for Net Sales.

3.	Compute the gross profit percentage.

Psymon Company, Inc. sells construction equipment. The annual fiscal perlod ends on December 31. The following adjusted trial balance was created from the general ledger accounts on December 31: Account Titles Cash Accounts Recelvable Inventory Property and Equipment Accumulated Depreclation Liabilities Common Stock Retalned Earnings, January 1 Sales Revenue Sales Returns and Allowances Sales Discounts Cost of Goods Sold Salaries and Wages Expense Office Expense Interest Expenses Income Tax Expense Debits $ 48,280 20,400 74,000 56,000 Credits $ 23,500 34,200 02,000 12,800 209,000 7,600 9,200 112,400 19,400 20,400 2,600 11,220 Totals $381,500 381,500