1. E6-9 Reporting Purchases, Purchase Discounts, and Purchase Returns Using a Pe

Question

1. E6-9 Reporting Purchases, Purchase Discounts, and Purchase Returns Using a Perpetual Inventory System [LO 6-3] During the month of June, Ace Incorporated purchased goods from two suppliers. The sequence of events was as follows June 3 Purchased goods for $3,800 from Diamond Inc. with terms 2.0/10, n/30 5 Returned goods costing $850 to Diamond Inc. for full credit. 6 Purchased goods from Club Corp. for $800 with terms 3.0/10, n/30. 11 Paid the balance owed to Diamond Inc. 22 Paid Club Corp. in full. Required Assume that Ace uses a perpetual inventory system and that the company had no inventory on hand at the beginning of the month. Calculate the cost of inventory as of June 30. (Do not round intermediate calculations. Round your answer to 2 decimal places) Cos t of Inven tory

Explanation / Answer

Cost of inventory = (3800-850)*(1-0.02)+800= $3691

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