The following amounts summarize Alpaca Company’s merchandising activities during 2022. Set up T accounts for Merchandise Inventory and Cost of Goods Sold. Then record the activities directly in the T accounts and calculate the account balances.

Cost of merchandise sold to customers in sales transactions....................... $90,000
Invoice cost of merchandise purchases..............................................................  93,000
Merchandise Inventory balance, December 31, 2021 ....................................... 17,500
Purchases returns and allowances received .......................................................   2,050
Purchase discounts received .................................................................................      800
Cost of merchandise returned by customers and restored to inventory.......       550
Cost of transportation ............................................................................................      950