Costs of $5,000 were incurred to acquire goods and make them ready for sale. The goods were shipped to the buyer (FOB shipping point) for a cost of $200. Additional necessary costs of $400 were incurred to acquire the goods. No other incentives or discounts were available. What is the buyer’s total cost of merchandise inventory? a. $5,000 b. $5,200 c. $5,400 d. $5,600

Question

Costs of $5,000 were incurred to acquire goods and make them ready for sale. The goods were shipped to
the buyer (FOB shipping point) for a cost of $200. Additional necessary costs of $400 were incurred to
acquire the goods. No other incentives or discounts were available. What is the buyer’s total cost of merchandise
inventory?
a. $5,000 b. $5,200 c. $5,400 d. $5,600

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