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Cost of goods sold

A company is a merchanding company that used the periodic inventory system. the data below if the from the accounting records for the year ended dec 31, 2004
calculate cost of goods sold for 2004, show all calculations:

sales revenue-585,000
sales discounts-3,000
purchases-420,000
purchase returns and allowances-5,000
inventory (jan 1)33,000
inventory (dec 31)37,000
operating expenses-146,000
retained earnings (jan 1)71,000

Solution Preview

The cost of goods sold is calculated as under
Opening Inventory + Net Purchases = Goods Available for ...

Solution Summary

The solution explains the calculation of cost of goods sold.

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