Now that operations for outdoor clinics and TEAM events are running smoothly, Suzie thinks of another area for business expansion. She notices that a few clinic participants wear multiuse $($MU$)$ watches. Beyond the normal timekeeping features of most watches, MU watches are able to report temperature, altitude, and barometric pressure. MU watches are waterproof, so moisture from kayaking, rain, fishing, or even diving up to $100$ feet won$$t damage them. Suzie decides to have MU watches available for sale at the start of each clinic. The following transactions relate to purchases and sales of watches during the second half of $2025.$ All watches are sold for $$505$ each.

July $17$ Purchased $55$ watches for $$8,525($$$155$ per watch$)$ on account.

July $31$ Sold $45$ watches for $$22,725$ cash.

August $12$ Purchased $45$ watches for $$7,425($$$165$ per watch$)$ cash.

August $22$ Sold $35$ watches for $$17,675$ on account.

September $19$ Paid for watches purchased on July $17.$

September $27$ Receive cash of $$12,000$ for watches sold on account on August $22.$

October $27$ Purchased $85$ watches for $$14,875($$$175$ per watch$)$ cash.

November $20$ Sold $95$ watches for $$47,975$ cash.

December $4$ Purchased $110$ watches for $$20,350($$$185$ per watch$)$ on account.

December $8$ Sold $45$ watches for $$22,725$ on account.

Required:

$1-$a$.$ Calculate sales revenue, cost of goods sold, and ending inventory as of December $31,2025,$ assuming Suzie uses a FIFO perpetual inventory system to account for inventory.

$1-$b$.$ Prepare the gross profit section of a partial income statement for transactions related to MU watches.