Suppose Puma uses the perpetual inventory system to purchase T-shirts on account for $15,000 from Gildan Activewear Inc. It cost Puma $1,000 FOB Gildan to ship the T-shirts from Gildan to Puma as well as duty and excise fees of $200. Puma was also fined $300 for unloading the inventory in an unauthorized area.

1. Compute the cost of inventory to Puma.

2. Puma pays $500 to deliver the goods to three downtown Sportmart retail outlets. How would this cost be recorded?