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Svet_ta [14]
2 years ago
7

At the beginning of 2018, Midway Hardware has an inventory of $310,000. Because sales growth was strong during 2018, the owner w

ants to increase inventory on hand to $360,000 at December 31, 2018. If net sales for 2018 are expected to be $2,100,000, and the gross profit rate is expected to be 25%, compute the cost of the merchandise the owner should expect to purchase during 2018.
Business
1 answer:
nalin [4]2 years ago
4 0

Answer:

$1,625,000

Explanation:

For computing the purchase amount first we have to determine the cost of goods sold which is shown below;

As we know that

Cost of goods sold = Sales revenue - gross profit

                               = $2,100,000 - $2,100,000 × 25%

                               = $2,100,000 - $525,000

                               = $1,575,000

Now the purchase amount is

Cost of goods sold = Beginning inventory + purchase - ending inventory

$1,575,000 = $310,000 + purchase - $360,000

So, the purchase amount is $1,625,000

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Answer:

See explanation section.

Explanation:

Requirement 1

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As the future of the world is getting modernized, General Electric company is focusing on software and the Internet of Things. GE is trying to take its customers base from traditional on-site manufacturing to digital software-based operations. The launch of sensor-generating data has revolutionized the success. Using cloud-based data make the company more productive and reliable. The overall thinking towards the future is superlative.

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