DEF Supermarket sells groceries. Financial transactions for 2023 include:

Transactions (in $ millions)	Amount
Cash Sales	90.0
Credit Sales	40.0
Cash Payments	60.0
Accounts Receivable	25.0
Inventory Purchases	50.0
Estimated Inventory Shrinkage	7.0

Requirements:

• Prepare DEF Supermarket's income statement for 2023 using the modified cash basis.
• Calculate net income considering the conservatism principle.
• Discuss the impact of estimated inventory shrinkage on financial statements.
• Analyze the treatment of accounts receivable and inventory purchases under the conservatism principle.