Question

If beginning inventory is $60,000, cost of goods purchased is $380,000, sales revenue is $800,000 and ending inventory is $50,000, how much is cost of goods sold under a periodic system

Answer 1

Answer:

$390000

Explanation:

Given: Beginning inventory= $60000

          Cost of goods purchased = $380,000

          Sales revenue= $800000.

          Ending inventory= $50000.

The Periodic inventory system is used to determine the amount of inventory available at the end of each accounting period.

Cost of goods sold= $beginning\ inventory+ cost\ of\ goods\ purchased- ending\ inventory$

⇒ Cost of goods sold= $60000+380000-50000$

⇒ Cost of goods sold= $\ 440000 - \ 50000$

∴ Cost of goods sold= $\ 390000$.

Hence, $390000 is the cost of goods sold under a periodic system.