Question

Arbor Corporation reports the following: Sales revenue $183,000; ending inventory $12,600; beginning inventory $15,600; purchases $64,000; purchases discounts $4,000; purchase returns and allowances $1,500; freight-in $1,000; freight-out $500. Calculate the company's cost of goods sold.

Answer 1

Answer: Cost of goods sold = $62500

Explanation:

Given that,

Sales revenue = $183,000

Ending inventory = $12,600

Beginning inventory = $15,600

purchases = $64,000

purchases discounts = $4,000

purchase returns and allowances = $1,500

freight-in = $1,000

freight-out = $500

Cost of goods sold = Beginning inventory + purchases - purchases discounts - purchase returns and allowances + freight-in - Ending inventory

= $15,600 +  $64,000 - $4,000 - $1,500 + $1,000 - $12,600

= $62500