Valley Company provided its general ledger accounts and supplementary records for the fiscal year ended August 31. The records show beginning inventory, various expense accounts categorized as either selling expenses or general and administrative, and itemized merchandising costs. From this information, multi-step and single-step income statements can be prepared that include net sales, cost of goods sold, selling expenses, and general and administrative expenses.

1. Valley Company's adjusted account balances from its general ledger on August 31, its fiscal
year-end, follows. It categorizes the following accounts as selling expenses: sales salaries
expense, rent expense-selling space, store supplies expense, and advertising expense. It
categorizes the remaining expenses as general and administrative. Beginning merchandise
inventory was $31 , 473 . Supplementary records of merchandising activities for the year ended
August 31 reveal the following itemized costs. Required: 1. Compute the company's net sales for
the year. 2. Compute the company's 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. Complete this question by entering your answers in the tabs
below. Compute the company's net sales for the year.