A Company That Uses the Perpetual Inventory Method Purchases Inventory

question 21

Multiple Choice

A company that uses the perpetual inventory method purchases inventory for $2,000 from a vendor on account,FOB shipping point,with terms of 2/10,n/30.The company paid the shipper $100 cash for freight in.
-The company paid the vendor 9 days after the sale.Assuming this was the only transaction affecting inventory,and that there was no beginning balance,what would the cost basis of the inventory be?

• A) $1,960
• B) $2,000
• C) $2,060
• D) $2,100

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Definitions:

Cathartic Opportunities

Situations or activities that allow for the release of strong or repressed emotions.

Hostile Masculinity

A personality configuration characterized by hostility towards women, an inclination towards aggression, and a desire to dominate or control women.

Sexual Coercion

The act of using pressure, alcohol or drugs, or force to have sexual contact with someone against their will.

Instrumental Aggression

Aggressive behavior used as a means to achieve a goal, rather than for the sake of aggression itself.