Problem 4-3A Computing merchandising amounts and formatting income statements LO C2, P4

Valley Companys adjusted trial balance on August 31, 2017, its fiscal year-end, follows.

		Debit			Credit
Merchandise inventory		$	34,000
Other (noninventory) assets			136,000
Total liabilities					$	39,270
Common stock						10,000
Retained earnings						103,619
Dividends			8,000
Sales						232,560
Sales discounts			3,558
Sales returns and allowances			15,349
Cost of goods sold			90,401
Sales salaries expense			31,861
Rent expenseSelling space			10,930
Store supplies expense			2,791
Advertising expense			19,768
Office salaries expense			29,070
Rent expenseOffice space			2,791
Office supplies expense			930
Totals		$	385,449		$	385,449

On August 31, 2016, merchandise inventory was $27,438. Supplementary records of merchandising activities for the year ended August 31, 2017, reveal the following itemized costs.

Invoice cost of merchandise purchases	$	99,960
Purchases discounts received		2,099
Purchases returns and allowances		4,798
Costs of transportation-in		3,900

Required:

1. Compute the companys net sales for the year. 2. Compute the companys total cost of merchandise purchased for the year. 3. Prepare a multiple-step income statement that includes separate categories for net sales, cost of goods sold, selling expenses, and general and administrative expenses. 4. Prepare a single-step income statement that includes these expense categories: cost of goods sold, selling expenses, and general and administrative expenses.