Choose the right answer. Gomez Co. purchased $5,000 of inventory on account with
ID: 2427995 • Letter: C
Question
Choose the right answer.
Gomez Co. purchased $5,000 of inventory on account with payment terms of 2/10, n/30. The goods were delivered FOB shipping point. Gomez paid freight costs of $200 in cash. Gomez paid for the goods within the discount period. Assuming a beginning inventory balance of zero, what would be the balance in the inventory account after the purchase and payment for inventory were recorded? Gomez Co. keeps perpetual inventory records and uses the gross method of accounting for inventory purchases.
$4,900
$5,300
$5,100
$4,700
$4,900
$5,300
$5,100
$4,700
Explanation / Answer
Answer:
The balance in the inventory account after the purchase and payment for inventory were recorded would be $5100.
After 2% discount price $4900($5000*.98)+$200 Freight Cost = $5100.