Problem 5-4A Wolford Department Store is located in midtown Metropolis. Duringthe past several years, net income has been declining becausesuburban shopping centers have been attracting business away fromcity areas. At the end of the company’s fiscal year on November 30,2017, these accounts appeared in its adjusted trial balance. Accounts Payable $ 34,840 Accounts Receivable 22,360 Accumulated Depreciation—Equipment 88,400 Cash 10,400 Common Stock 45,500 Cost of Goods Sold 798,590 Freight-Out 8,060 Equipment 204,100 Depreciation Expense 17,550 Dividends 15,600 Gain on Disposal of Plant Assets 2,600 Income Tax Expense 13,000 Insurance Expense 11,700 Interest Expense 6,500 Inventory 34,060 Notes Payable 56,550 Prepaid Insurance 7,800 Advertising Expense 43,550 Rent Expense 44,200 Retained Earnings 18,460 Salaries and Wages Expense 152,100 Sales Revenue 1,175,200 Salaries and Wages Payable 7,800 Sales Returns and Allowances 26,000 Utilities Expense 13,780 Additional data: Notes payable are due in 2021.

Prepare a multiple-step income statement. (Listother revenues before other expenses.) WOLFORD DEPARTMENT STORE Income Statement choose the accounting period For the Year Ended November 30, 2017November 30, 2017For theMonth Ended November 30, 2017 Select an opening name for section one DividendsNet Income / (Loss)Retained Earnings, December 1,2011Retained Earnings, November 30, 2012SalesTotal RevenuesNetSalesGross ProfitOperating ExpensesTotal Operating ExpensesIncomeFrom OperationsOther Revenues and GainsOther Expenses andLossesIncome Before Income Taxes

Prepare a retained earnings statement. (List itemsthat increase retained earnings first.) WOLFORD DEPARTMENT STORE Retained Earnings Statement choose the accounting period For the Month Ended November 30, 2017For the Year Ended November30, 2017November 30, 2017 select an opening name DividendsExpensesNet Income / (Loss)Retained Earnings, December1, 2016Retained Earnings, November 30, 2017Sales RevenuesTotalExpensesTotal RevenuesNet SalesGross ProfitOperating ExpensesTotalOperating ExpensesIncome From OperationsOther Revenues andGainsOther Expenses and LossesIncome Before Income Taxes $enter a dollar amount

Prepare a classified balance sheet. (List currentassets in order of liquidity.) WOLFORD DEPARTMENT STORE Balance Sheet choose the accounting period For the Year Ended November 30, 2017November 30, 2017For theMonth Ended November 30, 2017 Assets select an opening name for subsection one Current AssetsCurrent LiabilitiesExpensesIntangibleAssetsLong-term InvestmentsLong-term LiabilitiesProperty, Plant andEquipmentRevenuesStockholders' EquityTotal AssetsTotal CurrentAssetsTotal Current LiabilitiesTotal ExpensesTotal IntangibleAssetsTotal LiabilitiesTotal Liabilities and Stockholders'EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotalProperty, Plant and EquipmentTotal RevenuesTotal Stockholders'Equity

Calculate the profit margin and the gross profit rate.(Round answers to 1 decimal place, e.g.15.2%) Profit margin enter Profit margin in percentages rounded to 1 decimalplace % Gross profit rate enter Gross profit rate in percentages rounded to 1 decimalplace %

The vice president of marketing and the director of humanresources have developed a proposal whereby the company wouldcompensate the sales force on a strictly commission basis. Giventhe increased incentive, they expect net sales to increase by 15%.As a result, they estimate that gross profit will increase by$52,576 and expenses by $76,180. Compute the expected new netincome. Then, compute the revised profit margin and gross profitrate. (Ignore income tax effects.) Revised net income $enter revised net income in dollars Revised profit margin (Round to 1 decimal place,e.g. 15.2%) enter Revised profit margin in percentages rounded to 1 decimalplace % Revised gross profit rate (Round to 1 decimalplace, e.g. 15.2%) enter Revised gross profit rate in percentages rounded to 1decimal place %