Problem 5-3A 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		$	39,500
Other (noninventory) assets			158,000
Total liabilities					$	45,623
K. Valley, Capital						130,073
K. Valley, Withdrawals			8,000
Sales						270,180
Sales discounts			4,134
Sales returns and allowances			17,832
Cost of goods sold			104,394
Sales salaries expense			37,015
Rent expenseSelling space			12,698
Store supplies expense			3,242
Advertising expense			22,965
Office salaries expense			33,773
Rent expenseOffice space			3,242
Office supplies expense			1,081
Totals		$	445,876		$	445,876

On August 31, 2016, merchandise inventory was $31,877. Supplementary records of merchandising activities for the year ended August 31, 2017, reveal the following itemized costs.

Invoice cost of merchandise purchases	$	116,130
Purchases discounts received		2,439
Purchases returns and allowances		5,574
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