A Company Buys Large Recreational Vehicles ("RVS") and Sells Them

Multiple Choice

A company buys large recreational vehicles ("RVS") and sells them on credit.The company uses a perpetual inventory system and always pays for purchases within the discount period by borrowing.Information about the latest purchase of an RV is: $\begin{array} { l } \text {Purchase price. }&\$60,000\\ \text { Delivery charges.}&2,500\\ \text {Terms, on credit, \( 5 / 30, \mathrm{n} / 90 \) Insurance premium paid. }&3,000\\ \text {Cleaning and making ready for sale. }&250\\ \text {Interest on purchase loan. }&7,200\\ \text {Cost of permanent shed built to display the RV pending sale. }&3,750\\\end{array}$
The cost that should be assigned to the RV for inventory purposes is:

A) $65,750
B) $62,750
C) $59,750
D) $60,000