Question - Tara Kelly Inc. has $4,000 in INVENTORY at Jan 1, 2015. During 2015, Tara had the following INVENTORY TRANSACTIONS:
a. Tara Kelly purchased Merchandise Inventory from Glenn Charles, $5,400 terms 3/10, net/30, FOB Shipping Point.
b. Tara paid freight on shipment from Glenn Charles $1,200.
c. Tara sold Merchandise Inventory to Logan Inc for $7,500 Cost $3,850 Terms: 2/10, net/30 FOB Destination.
d. Tara returned $850 of Merchandise Inventory purchased from Glenn Charles.
e. Logan Inc returned $1,250 of Merchandise Inventory to Tara, cost $760.
f. Tara paid Glenn Charles Inc. within discount period.
g. Tara paid $550 for freight on sale to Logan.
h. Received payment from Logan Inc, during the discount period.
REQUIRED:
a. Record the Transactions in the JOURNAL using the Perpetual Inventory Method.
b. What is the Ending Value in Merchandise Inventory and Cost of Goods?