Yasir Supply uses a perpetual inventory system. On January 1, its inventory account had a beginning balance of 6,450,000. Yasir engaged in the following transactions during the year:

Prepare all transaction as General Entries.

1. Purchased merchandise inventory for 9,500,000.

2. Generated net sales of 26,000,000.

3. Recorded inventory shrinkage of 10,000 after taking a physical inventory at year-end.

4. Reported gross profit for the year of 15,000,000 in its income statement.

Now answer the following:

a. At what amount was Cost of Goods Sold reported in the companys year-end income statement?

b. At what amount was Merchandise Inventory reported in the companys year-end balance sheet?

c. Immediately prior to recording inventory shrinkage at the end of the year, what was the balance of the Cost of Goods Sold account? What was the balance of the Merchandise Inventory account?

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