i. An analysis of the cost of sales account revealed that the inventory is valued at average cost within each of the different styles carried. Since the owner is still learning what has appeal, a mark down rack has become a common fixture at the back of the store. The tagged prices of the mark-downs are less that their costs, at December 31^st.2021 by $1,400. This difference has not been recorded in the financial statement.

ii. Cost of goods sold includes a charge of $2,800 to set up an allowance for returns that are subsequently saleable at full retail price. No such allowance was recorded last year-end because the company only discovered that the allowance was necessary this year.

iii. General and administrative expenses include the following:-

Contributions to a registered pension plan made monthly for the two key employees, expensed

By the Corporations accountant were as follows:-

Registered Pension Plan...........Employment Compensation

President and CEO$42,000$380,000

Store Manager$25,600. 260,000

The pension n plan is a defined contribution (money purchase)plan. The contributions above were matched by equal contributions made by the employee.