Dundas Desks is a retailer of school desks who takes physical counting at the end of each month to determine the

value of inventory. Dundas Desks completed the transactions below during August.

Aug. 2 Purchased 140 desks from Harbor Inc at a price of $ 80 each terms 2/10, n/30. FOB shipping $ 15 was paid.

Aug. 4 Sold 80 desks to Raymond at $ 140 each terms 3/10, n/30. FOB destination $ 20 was paid.

Aug. 8 Returned 30 of the desks purchased on 2 August as found defective.

Aug.10 Raymond returned 11 of the desks sold on 4 August as they are not meeting the specification.

Aug.12 Received collection from Raymond.

Aug.15 Made payment to Harbor Inc.

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Required:

a.What is the nature of business of Dundas company?

b.Is there any difference between the presentation of income statement of a trading company and service

company, elaborate in two lines?

c.Which inventory accounting System Company is following? Justify your answer in one line.

d.Record the transactions in the books of Dundas assume company is using Net approach.