TEL L88.@ nn( }0.prnan 24, SmartArt. The Company buys 300 pens from the manufact

Question

TEL L88.@ nn( }0.prnan 24, SmartArt. The Company buys 300 pens from the manufacturer for $ 600. The pens are shipped FOB shipping point with the buyer paying the S 100 shipping cost. The next day they return 20 pens. The Company then takes a $ 50 purchase allowance on the remaining pens. The terms of the invoice were 2/10, net 30. The pens were sold on May 15th and paid for on May 20th taking advantage of the discount. How much was the inventory cost per pen? A. $ 2.135 B. $ 2.000 C. S2.142 D. $ 1.998 E. None of the above F. I don't know how to do this 20% 0%0%%0%0%

Explanation / Answer

Original purchased pens 300 Less: Return 20 Net Pens 280 Cost of 300 pen @ 2 per pen $600 Add: Shipping per pen = $100 Less:Purchase Return = 2 x 20 -$40 Less: Discount = ($600 - $40- $50)x2% -10.2 Less: Purchases Allowance -$50 Net Purchased price of 280 pens $600 Cost per pen = $600/280 $2.142

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