Stan's Market Recorded the Following Events Involving a Recent Purchase

question 212

Multiple Choice

Stan's Market recorded the following events involving a recent purchase of inventory: Received goods for $90,000, terms 2/10, n/30.
Returned $1,800 of the shipment for credit.
Paid $450 freight on the shipment.
Paid the invoice within the discount period.
As a result of these events, the company's inventory

• A) increased by $86,436.
• B) increased by $88,650.
• C) increased by $86,877.
• D) increased by $86,886.

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Definitions:

Unit Sales

The total number of individual units of a product sold in a specific period.

Net Operating Income

Represents the earnings derived from a company's ongoing, regular business activities, underscored by subtracting day-to-day expenses from total income.

Selling Price

The amount of money for which a product, asset, or service is sold, determining the revenue received from the transaction.

Fixed Expenses

Financial obligations that stay uniform in spite of changes in manufacturing or sales figures, like leasing expenses, salaries for workers, and insurance outlays.