Basic Principles of AccountingTAKE HOME ASSIGNMENTInventoryPart AProblem 6-1A.1) MULTIPLE-STEP INCOME STATEMENTFor year ended March 31, 2008Revenue from sales:Sales1,542,000Less: sales returns27,720Sales discounts26,280NET SALES1,488,000Cost of merch. sold930,000Gross Profit558,000Operating Expenses:Selling:Sales salaries expenses207,840Advertising expense52,560Depr. expense – store equip.7,680Misc. selling expense1,920Total selling exp:270,000Administrative Exp:Office salaries expense:100,980Rent expense:37,620Depr. expense – office equip.15,240Insurance expense:4,680Office supplies expense:1,560Misc. administrative expense:1,920Total admin. exp:168,000Total operating expenses:438,000Income from Operations120,000Other Income and ExpenseInterest Revenue(6,000)NET INCOME114,0002) STATEMENT OF OWNER’S EQUITYFor Year Ended March 31, 2008Tiffany Garland, capital April 1, 2007564,900Net income for year114,000Less Withdrawals42,000Increase in Owner’s Equity72,000