Required information the following information applies to the questions displayed below j at the beginning of year 2, the redd company had the following balances in its accounts cash inventory common stock retained earnings $8,800 2,888 8,300 3,3e0 during year 2. the company experienced the following events 1. purchased inventory that cost $6.300 on account from ross company under terms 2/10, n/30 the merchandise was delivered fob shipping point freight costs of $580 were paid in cash. 2 returned $400 of the inventory it had purchased because the inventory was damaged in transit the seller agreed to pay the return freight cost 3. paid the amount due on its account payable to ross company
Required information The following information applies to the questions displayed below J At the beginning of Year 2, the Redd Company had the following balances in its accounts Cash Inventory Common stock Retained earnings $8,800 2,888 8,300 3,3e0 During Year 2. the company experienced the following events
1. Purchased inventory that cost $6.300 on account from Ross Company under terms 2/10, n/30 The merchandise was delivered FOB shipping point Freight costs of $580 were paid in cash.
2 Returned $400 of the inventory it had purchased because the inventory was damaged in transit The seller agreed to pay the return freight cost
3. Paid the amount due on its account payable to Ross Company within the cash discount period.
4. Sold inventory that had cost $6,800 for $9,800 on account, under terms 2/10, n/45
5. Recerved merchandise returned from a customer The merchandise originally cost $580 and was sold to the customer for $880 cash. The customer was paid S880 cash for the returned merchandise
6. Delivered goods FOB destination in Event 4. Freight costs of $680 were paid in cash.
7. Collected the amount due on the account receivable wthin the discount periocd
8. Took a physical count indicating that $2.500 of inventory was on hand at the end of the accounting penod b. Record each event in a statements model ike the following one. In the Cash Flow column, use OA to designate operating activity, IA for investment activity, FA for financing activity, NC for net change in cash and NA to indicate the element is not affected by the event The first event is recorded as an example (Enter any decreases to account beiances and cash outflows with a minus sign.j 3 Answer is not complete REDD COMPANY