Avanti purchases inventory from overseas and incurs the following costs: the merchandise cost is $50,000,credit terms 2/10,n/30 that apply only to the $50,000;FOB shipping point freight charges are $1,500;insurance during transit is $500;and import duties are $1,000.Avanti paid within the discount period and incurred additional costs of $1,200 for advertising and $5,000 for sales commissions.Compute the cost that should be assigned to the inventory.
A)$50,000
B)$53,000
C)$52,000
D)$51,500
E)$53,200

Question

Quizplus · Accepted Answer

The Answer of Avanti purchases inventory from overseas and incurs the following costs: the merchandise cost is $50,000,credit terms 2/10,n/30 that apply only to the $50,000;FOB shipping point freight charges are $1,500;insurance during transit is $500;and import duties are $1,000.Avanti paid within the discount period and incurred additional costs of $1,200 for advertising and $5,000 for sales commissions.Compute the cost that should be assigned to the inventory.
A)$50,000
B)$53,000
C)$52,000
D)$51,500
E)$53,200

Avanti Purchases Inventory from Overseas and Incurs the Following Costs