The following selected accounts and their current balances appear in the ledger of Clairemont Co. For the fiscal year ended May 31, 2016:Cash $ 240,000Accounts Receivable 966,000Merchandise Inventory 1,712,500Office Supplies 13,500Prepaid Insurance 8,000Office Equipment 830,000Accumulated Depreciation-Office Equipment 550,000Store Equipment 3,600,000Accumulated Depreciation-Store Equipment 1,820,000Accounts Payable 366,000Salaries Payable 41,500Note Payable (current portion) 50,000Note Payable (final payment due 2022) 300,000Kristina Marble, Capital 3,449,100Kristina Marble, Drawing 100,000Sales 11,343,000Cost of Merchandise Sold 7,850,000Sales Salaries Expense 916,000Advertising Expense 550,000Depreciation Expense—Store Equipment 140,000Miscellaneous Selling Expense 38,000Office Salaries Expense 650,000Rent Expense 94,000Depreciation Expense—Office Equipment 50,000Insurance Expense 48,000Office Supplies Expense 28,100Miscellaneous Administrative Expense 14,500Interest Expense 21,000Required:1. Prepare a multiple-step income statement. In theOther income and expenses section only, enter amounts that represent other expenses as negative numbers using a minus sign. *2. Prepare a statement of owner’s equity. *3. Prepare a report form of balance sheet. "Less" or "Plus" will automatically appear if it is required. *4. Briefly explain (a) how multiple-step and single-step income statements differ and (b) how report-form and account-form balance sheets differ. * Be sure to complete the statement headings. Refer to the problem data and the list of Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries. A colon (:) will automatically appear if it is required. Labels Amount DescriptionsAdministrative expenses Gross profitCurrent assets Income from operationsCurrent liabilities Increase in owner’s equityFor the Year Ended May 31, 2016 Kristina Marble, capital, June 1, 2015Long-term liabilities Kristina Marble, capital, May 31, 2016May 31, 2016 Less withdrawalsOperating expenses Net incomeOther income and expense Net income for the yearProperty, plant, and equipment Net lossSelling expenses Total administrative expensesTotal assetsTotal current assetsTotal current liabilitiesTotal liabilitiesTotal liabilities and owner’s equityTotal operating expensesTotal property, plant, and equipmentTotal selling expensesIncomestatementPrepare a multiple-step income statement. Be sure to complete the statement heading. Refer to the problem data and the list of Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries. A colon (:) will automatically appear if it is required. In the Other income and expenses section only, enter amounts that represent other expenses as negative numbers using a minus sign. Statement of owner's equityPrepare a multiple-step income statement. Be sure to complete the statement heading. Refer to the problem data and the list of Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries. A colon (:) will automatically appear if it is required. In the Other income and expenses section only, enter amounts that represent other expenses as negative numbers using a minus sign. Balamce SheetPrepare a report form of balance sheet. Be sure to complete the statement heading. Refer to the problem data and the list of Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries. A colon (:) will automatically appear if it is required. "Less" or "Plus" will automatically appear if it is required. A colon (:) will automatically appear if it is required. QuestionsBriefly explain (a) how multiple-step and single-step income statements differ and (b) how report-form and account-form balance sheets differ. (a) Which type of income statement shows intermediate balances?Multiple-step or Single-step(b) Which type of balance sheet presents assets, liabilities, and owner's equity in a downward sequence?Account form or Report form
