Calculate the Merchandise Inventory balance at the end of the period, given these transactions. The company uses a perpetual inventory system and there was no beginning inventory balance.

7/1 Purchased $1,800 of merchandise on account.

7/7 Sold merchandise to a customer for $1000 with terms 1/10;n/30. The cost of the merchandise is $300.

7/10 The customer returned merchandise to the company received a credit for $100. The cost of the merchandise returned was $40.

7/11 The customer paid the full amount owed within the discount period.

Multiple Choice

$1,540.

$900.

$1,100.

$1,500.

$1,600.

$891

$940