Use for questions 1 and 2:

On April 1, 2020, merchandise subject to terms 2/10, n/30 was sold on account to a customer for $27,000. On April 4, the customer returned $8,500 of the goods and the seller issued a credit memorandum for that amount. This return occurred prior to payment by the customer. 1. What is the amount of cash required to be paid by the customer if payment is made on April 8, 2020?

2. What is the amount of cash required to be paid by the customer if payment is made on April 21, 2020? 3. Which of the following items represents a product cost that is includable in the value of inventory on the balance sheet? a. Transportation-in cost on merchandise purchased from suppliers. b. Commission paid to a salesperson at the time of a sale of goods. c. Transportation-out cost on goods delivered to customers. d. None of the above.

4. When the costs of inventory purchases are falling but sales prices to customers remain constant, a. LIFO will result in lower gross margin, lower net income and a lower ending inventory valuation than will FIFO. b. LIFO will result in higher gross margin, higher net income and a lower ending inventory valuation than will FIFO. c. LIFO will result in higher gross margin, higher net income and a higher ending inventory valuation than will FIFO. d. LIFO will result in higher net income and a higher ending inventory valuation than will FIFO, but gross margin will be the same under both FIFO and LIFO.