Question

Russell Retail Group begins the year with inventory of $45,000 and ends the year with inventory of $35,000. During the year, the company has four purchases for the following amounts.
Purchase on February 17 $200,000
Purchase on May 6 120,000
Purchase on September 8 150,000
Purchase on December 4 400,000
Calculate cost of goods sold for the year.

Answer 1

Answer:

COGS= $880,000

Explanation:

Giving the following information:

Beginning inventory= $45,000

Ending inventory= $35,000

Total Purchase= 870,000

To calculate the cost of goods sold (COGS), we need to use the following formula:

COGS= beginning finished inventory + cost of goods purchased - ending finished inventory

COGS= 45,000 + 870,000 - 35,000

COGS= $880,000