Recording the Cost of Purchases for a Merchandiser – Elite Apparel purchased 90 new shirts and recorded a total cost of $2,735 determined as follows:
|
Invoice cost |
$2,250 |
|
Shipping charges |
185 |
|
Import taxes and duties |
165 |
|
Interest (6.0%) on $2,250 borrowed to finance the purchase |
135 |
|
$2,735 |
Required:
Make the needed corrections in this calculation. Give the journal entry(ies) to record this purchase in the correct amount, assuming a perpetual inventory system. Show computations.