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At the beginning of Year 2, the Redd Company had the following balances in its accounts: Cash Inventory Land Common stock Retained earnings $ 6,900

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At the beginning of Year 2, the Redd Company had the following balances in its accounts: Cash Inventory Land Common stock Retained earnings $ 6,900 15,000 7,000 15,000 13,900 During Year 2, the company experienced the following events: 1. Purchased Inventory that cost $5,200 on account from Ross Company under terms 1/10, 1/30. The merchandise was delivered FOB shipping point. Freight costs of $190 were paid in cash. 2. Returned $400 of the inventory it had purchased from Ross Company because the inventory was damaged in transit The seller agreed to pay the return freight cost. 3. Pald the amount due on its account payable to Ross Company within the cash discount period. 4. Sold Inventory that had cost $6,800 for $12,100 on account, under terms 2/10, n/45 5. Received merchandise returned from a customer. The merchandise originally cost $900 and was sold to the customer for $1680 cash. The customer was paid $1,680 cash for the returned merchandise. 6. Delivered goods FOB destination in Event 4. Freight costs of $140 were paid in cash. 7. Collected the amount due on the account receivable within the discount period. 8. Sold the land for $8,500. 9. Recognized accrued interest income of $600. 10. Took a physical count indicating that $13,400 of inventory was on hand at the end of the accounting perlod. (Hint: Determine the current balance in the inventory account before calculating the amount of the inventory write down.) c. Post the beginning balances and the events to the T-accounts. Note that these ledger accounts will also be used when posting the closing entry that is created in Parte. Cash Merchandise Inventory Beg. Bal Beg Bail End Bal End. Bal Bal Accounts Receivable Interest Receivable Beg Bal Beg Bal Required information Land Accounts Payable Beg. Bal Beg. Bal End. Bal End. Bal + Common Stock Retained Earnings Beg. Bal Beg. Bal End. Bal End. Bal Sales Revenue Cost of Goods Sold Beg. Bal Beg. Bal O Required information Transportation-out Interest Revenue Beg. Bal Beg. Bal Bal Bal + Gain on Sale of Land Beg. Bal Bal

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