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Select the statements below that correctly describe the flow of costs in a merchandiser's accounting cycle.

Merchandise that is sold becomes an asset reported on the balance sheet.

Merchandise that is sold becomes an expense reported on the income statement.

Beginning inventory $+$ net purchases $=$ Merchandise available for sale.

Merchandise purchased is an expense and is reported on the income statement.

Ending inventory $+$ Cost of goods sold $=$ Total merchandise available for sale.

Merchandise that is purchased becomes an asset reported on the balance sheet.

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