The following summarizes Tesla’s merchandising activities for the year. Set up T-accounts for Merchandise Inventory and for Cost of Goods Sold. Enter each line item into one or both of the two T-accounts and compute the T-account balances.

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Cost of merchandise sold to customers... Merchandise inventory, beginning-of-year... Merchandise purchases, gross amount. Shrinkage on inventory as of year-end... Transportation-in for merchandise purchases. Cost of merchandise returned by customers (and restored to inventory)..... Discounts received from suppliers on merchandise purchases.... Returns to and allowances from suppliers on merchandise purchases...... $196,000 25,000 192,500 800 2,900 2,100 1,700 4,000