(Solved): Instructions a. Prepare an income statement and a retained earnings statement for the year. b. Prep ...

Instructions a. Prepare an income statement and a retained earnings statement for the year. b. Prepare a classified balance sheet at July 31 . Under a perpetual inventory system, purchase returns are debited to Purchase Returns and Allowances. freight costs are debited to Freight-Out. purchases on account are debited to Purchases. purchases on account are debited to Inventory.