The following amounts summarize Transeer Company’s merchandising activities during 2023. Set up T-accounts for Merchandise Inventory and Cost of Goods Sold. Then record the activities directly in the accounts and calculate the account balances.

Analysis Component:
You are the inventory manager and have reviewed these numbers. Comment on the shrinkage.

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Cost of merchandise sold to customers in sales transactions.... Merchandise inventory balance, Dec. 31, 2022........ Invoice cost of merchandise purchases..... Shrinkage determined on Dec. 31, 2023... Cost of transportation-in.............. Cost of merchandise returned by customers and restored to inventory... Purchase discounts received.............. Purchase returns and allowances received................ $180,000 35,000 186,000 31,000 1,900 2,200 1,600 .4,100