The Following Inventory Transactions Occurred at Zapata,Inc $\quad$ $\quad$

question 83

Essay

The following inventory transactions occurred at Zapata,Inc.which uses a perpetual inventory system:
October 2 $\quad$ $\quad$ Purchased 50 units of inventory from a supplier on cre dit. The goods cost $\$ 30$ each and the credit terms were $2 / 10, \mathrm{n} / 15$ The shipping costswere $\$ 100$ under the terms FOB de stination
October 4 $\quad$ $\quad$ Returned 5 units of inventory to the supplier for credit on account.
October 6 $\quad$ $\quad$ Sold 15 units for $\$ 50$ each to customers for cash.
October 7 $\quad$ $\quad$ Accepted a return of one unit of inventory from the customer for a cash refund.
October 11 $\quad$ $\quad$ Paid the supplier for one-half of the inventory purchased on October 2 nd.
October 17 $\quad$ $\quad$ Paid the remaining balence owed to the supplier. Record the appropriate journal entry for each of these transactions.

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Definitions:

Units of Output

A measure of production output, quantifying the total amount of goods or services produced.

Marginal Revenue

The additional revenue that is generated by selling one more unit of a product or service.

Profit-maximizing

A strategy where firms set output and price levels to yield the highest possible profit.

Perfectly Competitive Market

A market structure characterized by many buyers and sellers, homogeneous products, and the freedom of entry and exit, leading to zero economic profit in the long run.