Identify the errors in the following schedule of cost of merchandise sold for the current year ended December 31, 2006: Cost of merchandise sold: Merchandise inventory, December 31, 2006 $120,000...

Identify the errors in the following schedule of cost of merchandise sold for the current year ended December 31, 2006: Cost of merchandise sold: Merchandise inventory, December 31, 2006 $120,000 Purchases $600,000 Plus: Purchases returns and allowances $14,000 Purchases discounts 6,000 20,000 Gross purchases $620,000 Less transportation in 7,500 Cost of merchandise purchased 612,500 Merchandise available for sale $732,500 Less merchandise inventory, January 1, 2006 132,000 Cost of merchandise sold $600,500