Shown below in T-account format are the beginning and ending balances ($ in millions) of both inventory and accounts payable. 

Required: 

1. Use a T-account analysis to determine the amount of cash paid to suppliers of merchandise during the reporting period if cost of goods sold was $300 million. 

2. Prepare a summary entry that represents the net effect of merchandise purchases during the reporting period.

Transcribed Image Text:

Inventory Beginning balance 90 Ending balance 93 Accounts Payable 14 Beginning balance 16 Ending balance