Answer:
$655,000= cost of goods purchased
Explanation:
Giving the following information:
sales, $800,000
beginning inventory, $40,000
ending inventory, $45,000
gross profit, $150,000
First, we need to calculate the cost of goods sold.
Gross profit= sales - cost of goods sold
Cost fo goods sold= sales - gross profit
COGS= $650,000
Now, we can determine the purchases using the following formula:
COGS= beginning finished inventory + cost of goods purchased - ending finished inventory
650,000= 40,000 + cost of goods purchased - 45,000
655,000= cost of goods purchased
