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23 September, 09:11

A company had purchased $10,000 of inventory in the month of January, took advantage of purchase discounts of $500, and paid $1000 to have the goods shipped to their factory. They paid $250 to insure the inventory against fire and spent $750 to store the inventory. The company did not return any of the inventory they purchased. What is the company's 'net purchases' for the month of January?

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  1. 23 September, 09:25
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    The company's net purchases for the month of January is $11,500

    Explanation:

    Item description Amount ($)

    Purchase price 10,000

    Less: purchase discount - 500

    Add: purchasing related costs

    Shipping costs + 1,000

    Fire insurance + 250

    Inventory storage costs + 750

    Net purchases 11,500
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