Question #4 (20 marks) The following data have been extracted from the financial statements of Pen Inc., a calendar- year merchandising corporation: Balance Sheet Data A/R, net Inventory A/P The balance sheet accounts have their usual balances. December 31, 2018 2019 $ 84,000 150,000 95,000 $ 78,000 140,000 98,000 Total sales for 2019 were $1,200,000 and for 2018 were $1,100,000. Cash sales were 20% of total sales each year. Cost of goods sold was $840,000 for 2019. Variable general and administrative (G&A) expenses for 2019 were $120,000. These expenses have varied in proportion to sales and have been paid at the rate of 50% in the year incurred and 50% the following year. Unpaid G&A expenses are not included in A/P (accounts payable). Fixed G&A expenses, including $35,000 depreciation and $5,000 bad debt expense, totaled $100,000 each year. The amount of such expenses involving cash payments was paid at the rate of 80% in the year incurred and 20% the following year. In each year, there was a $5,000 bad debt estimate and a $5,000 write-off. Unpaid G&A expenses are not included in A/P.