Question

Maya Company reports the following amounts for the year ending on December 31, 2004:

Merchandise Inventory, January 1, 2004 : $70,000                              Cost of Transportation : $2,300

Invoice Cost of Merchandise Purchases : $195,000                              Purchase Returns and Allowances: $4,650

Purchase Discounts Received: $3,500                                                 Cost of Goods Sold: $158,700

Cost of merchandise returned by customers and restored to inventory: $17,300

Calculate the Merchandise Inventory, December 31, 2004.

A)	$117,750
B)	$83,150
C)	$45,150
D)	$113,150
E)	$129,450

Answer 1

Beginning inventory	$70,000
Add: Transportation cost	2,300
Add: Purchase	195,000
Less: Purchase return	4,650
Less: Discount on purchase	3,500
Less: Cost of goods sold	158,700
Add: Sales return	17,300
Merchandise inventory December 31, 2014	$117,750

Option A is correct answer.