The following selected accounts and their current balances appear in the ledger of Sciatic Co. for the fiscal year ended July 31, 2006:

Instructions
1. Prepare a multiple-step income statement.
2. Prepare a retained earnings statement.
3. Prepare a report form of balance sheet, assuming that the current portion of the note payable is $6,000.
4. Briefly explain how multiple-step and single-step income statementsdiffer.

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$123,000 Accounts Receivable Merchandise Inventory Sales Returns and Allowances Cost of Merchandise Sold Accumulated Depreciation- Office Equipment Accumulated Depreciation- Accounts Payable Store Equipment Miscellaneous Selling Expense Office Salaries Expense Salaries Payable (final payment due 2016) Office Supplies Expense Miscellaneous Administrative Retained Earnings Interest Expense