Hasham Purchases Inventory from Overseas and Incurs the Following Costs

Multiple Choice

Hasham purchases inventory from overseas and incurs the following costs: the merchandise cost is $80,000, credit terms 1/10, n/30, applicable only to the $80,000; FOB shipping point freight charges are $2,500; insurance during transit is $300; and import duties are $1,500. Hasham paid within the discount period. Compute the cost that should be assigned to the inventory.

A) $83,500
B) $81,700
C) $84,300
D) $79,200
E) $81,000