Question

For the current year, Hodges Department Store reported the following data:

Answer 1

Using the lower-of-cost-or-market rule, what is the cost of goods sold for Hodges is: C. $989,020.

Cost of good sold

Using this formula

Cost of goods sold=Goods available for sale-Inventory balance

Where:

Goods available for sale=$1,074,450

Inventory balance=$85,430

Let plug in the formula

Cost of good sold=$1,074,450-$85,430

Cost of good sold=$989,020

Inconclusion Using the lower-of-cost-or-market rule, what is the cost of goods sold for Hodges is: C. $989,020.

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