Answer:
<u>Cost of Goods Sold (COGS) on its 2012 income statement $1723</u>
Explanation:
Jacob, Inc.
12/31/2011 12/31/2012
Accounts receivable $720 $452
Inventories $584 $816
Net fixed assets $637 $659
Accounts payable $413 $611
Jacob had materials purchases in 2011 of $1,753 and materials purchases in 2012 of $1,957.
This COGS is calculated by the following formula :
<u></u>
Cost of Goods Sold (COGS) = Beginning Inventory + Material Purchases - Ending Inventory
COGS= $ 584 + $ 1957 - $ 816= $ 1723
Calculations
Ending Inventories $ 816
<u>Less Beginning Inv $ 584</u>
<u>Difference $ 234 </u>
Materials Purchases (2012) $1,957
<u>Difference $ 234</u>
<u>Cost of Goods Sold (COGS) on its 2012 income statement $1723</u>