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Belk Antiques uses the periodic inventory system to account for its inventory transactions. The following account titles and balances were drawn from Belk's records for the year 2013: beginning balance in inventory, $42,000; purchases, $128,000; purchase returns and allowances, $12,000; sales, $520,000; sales returns and allowances, $3,900; freight in, $1,000; and operating expenses, $130,000. A physical count indicated that $26,000 of merchandise was on hand at the end of the accounting period.
Required:
a. Prepare a schedule of cost of goods sold. b. Prepare a multi step income statement.
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