Required information Problem 4-26A Comprehensive cycle problem: Perpetual system LO 4-2, 4-3,4-4,4-5, 4-6, 4-7 (The following information applies to the questions displayed below.) At the beginning of Year 2, the Redd Company had the following balances in its accounts: Cash Inventory Land Common stock Retained earnings $16,800 4,000 2,000 12,000 10,800 During Year 2, the company experienced the following events: 1. Purchased inventory that cost $11,200 on account from Ross Company under terms 2/10,n/30. The merchandise was delivered FOB shipping point. Freight costs of $800 were paid in cash. 2. Returned $600 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. Paid the amount due on its account payable to Ross Company within the cash discount period. 4. Sold inventory that had cost $8,000 for $13,500 on account, under terms 2/10, 1/45. 5. Received merchandise returned from a customer. The merchandise originally cost $1,200 and was sold to the customer for $2,100 cash. The customer was paid $2,100 cash for the returned merchandise. 6. Delivered goods FOB destination in Event 4. Freight costs of $800 were paid in cash. 7. Collected the amount due on the account receivable within the discount period. 8. Sold the land for $3,500. 9. Recognized accrued interest income of $500. 10. Took a physical count indicating that $6,500 of inventory was on hand at the end of the accounting period. (Hint: Determine the current balance in the inventory account before calculating the amount of the inventory write down.) Problem 4-26A Part . Post the beginning balances and the events to the T-accounts. Note that these ledger accounts will also be used when posting the losing entry that is created in Part e. Cash Merchandise Inventory Beg. Bal Beg. Bal End. Bal End. Bal Bal Accounts Receivable Interest Receivable Beg. Bal Beg. Bal End. Bal End. Bal Land Accounts Payable Beg. Bal Beg. Bal End. Bei End. Bal Common Stock Retained Earnings Beg Bal Beg. Bal End. Bai End. Bal Sales Revenue Cost of Goods Sold Beg Bal Beg. Bal Bal Bal Transportation-out Interest Revenue Beg Bal Beg. Bal Bal Bal Gain on Sale of Land Beg. Bal