Using the following information to answer questions 10 and 11 Mason's Hardware Store prepared Ihe following analysis of cost of goods sold for the previous Ihree years: Net income for the years 2004, 2005, and 2006 was $70,000, $60,000, and $55,000，respectively. Since net income was consistently declining, Mr. Mason hired a new accountant to investigate the cause(s) for the declines. The accountant determined the following:
1.Purchases of $35,000 were not recorded in 2004.