NixIt Companys ledger on July 31, its fiscal year-end, includes the following selected accounts that have normal balances (NixIt uses the perpetual inventory system).

Merchandise inventory	$	44,300		Sales returns and allowances	$	5,200
Retained earnings		128,300		Cost of goods sold		108,900
Dividends		7,000		Depreciation expense		11,600
Sales		161,100		Salaries expense		39,000
Sales discounts		4,200		Miscellaneous expenses		5,000

A physical count of its July 31 year-end inventory discloses that the cost of the merchandise inventory still available is $42,500.