Use the following information for the ten (10) questions that follow.

Company A (A) sells merchandise to Company B (B) that B intends on reselling to retail consumers. B purchases the merchandise under the terms of 5/15 n/30. B purchases 100 units at a cost of $8 per unit. The cost to A of the merchandise sold was $5 per unit.

After 10 days, B returns 10 units to A. There were no defects in the products and A intends on reselling these 10 items at a later date.

After 14 days, B pays what it owes to A.

1. On the date of the sale of the merchandise from A to B, what is the total COGS that A will recognize?

2. What is the gross profit that A will recognize on the date of the sale?

3. What is the impact to the income statement for B as a result of the purchase of the 100 items, less the 10 items returned?

4. For A, the return of the 10 items by B will result in what impact to the income statement? Please use the net amount.

5. For B, what is the Accounts Payable Balance AFTER the return of the 10 items?

6. If A had a TOTAL inventory balance of $3,000 PRIOR to the sale to B, what is the balance in inventory AFTER the sales return by B?

7. What is the total amount of cash that B pays to A? Enter as a positive number.

8. After the payment by B to A, what is the NET sales amount that B would show on its income statement?

9. What is the balance in inventory for B after ALL of the events described?

10.If A had a $3,000 balance in inventory before any interaction with B, what would be the inventory balance AFTER the sales, sales return, and payment by B?