Inventory a)

Caramelised Banana Ltd purchases banana shaped bowls for $16 (plus GST) each and sells them for 24 (plus GST) each in their banana themed shop. On 1 January 20X6, 23 bowls were in inventory.

Caramelised Banana Ltd completed the following transactions below during January:

• 2 January Purchased 23 bowls on account. Terms: 2/10, n/30.
• 3 January Paid freight cost of $30 plus GST on the 2^nd January purchase.
• 4 January Sold 15 bowls on account. Terms: 3/10, n/30 and paid freight cost of $40 plus GST.
• 8 January Returned 7 of the bowls purchased on 2^nd January and paid the amount due on the bowls retained in stock.
• 10 January Received payment for the bowls sold on the 4^th January.

A physical inventory count taken on 31^st January 20X6 showed 18 bowls in stock.

Required:

a) What is the amount of inventory recognised at 1 January?

b) Prepare general journal entries to record the transactions assuming a perpetual inventory system is used. Narrations are not required.