Question

"if beginning inventory is $100,000, cost of goods purchased is $500,000, sales revenue is $1,000,000 and ending inventory is $130,000, how much is cost of goods sold under a periodic system?"

Answer 1

Calculation of cost of goods sold under a periodic system:

It is given that the beginning inventory is $100,000, cost of goods purchased is $500,000, and ending inventory is $130,000. The cost of goods sold can be calculated as follows:

Cost of Goods Sold = Beginning inventory + Cost of goods purchased- Ending inventory

= 100,000 + 500,000 – 130,000

= $470,000

Hence, the cost of goods sold is $470,000