Cinnamon Buns Co. (CBC) started 2018 with $52,800 of merchandise on hand. During 2018, $296,000 in merchandise was purchased on account with credit terms of 3/10 n/30. All discounts were taken. Purchases were all made f.o.b. shipping point. CBC paid freight charges of $10,100. Merchandise with an invoice amount of $2,000 was returned for credit. Cost of goods sold for the year was $309,000. CBC uses a perpetual inventory system.

Assuming CBC uses the gross method to record purchases, ending inventory would be:

Multiple Choice

• $28,980.
• $39,080.
• $39,020.
• $47,900.