Question

Refer to the financial statements of Express, Inc. Attached Bellow

Assuming that $50,000 of cost of goods sold was due to non-inventory purchase expenses (distribution and occupancy costs), how much inventory did the company buy during the year? (Hint: Use a T-account of inventory to infer how much was purchased.)

EXPRESS, INC. CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (Amounts in Thousands, Except Per Share Amounts) 2017 2016 2015 NET SALES $ 2,138,030 $ 2,192,547 $ 2,350,129 COST OF GOODS SOLD, BUYING AND OCCUPANCY COSTS 1,522,797 1,529,343 1,554,852 Gross profit 615,233 663,204 795,277 OPERATING EXPENSES: Selling, general, and administrative expenses 562,088 559,541 587,747 Restructuring costs 22,869 Other operating expense, net 536 292 Total operating expenses 585,493 559,603 588,039 OPERATING INCOME 29,740 103,601 207.238 INTEREST EXPENSE, NET 2.242 13,468 15.882 OTHER (INCOME) EXPENSE, NET (537) (484) 672 INCOME BEFORE INCOME TAXES 28,035 90,617 190,684 INCOME TAX EXPENSE 33,200 74.171 NET INCOME 19,366 $ 57,417 $ 116,513 OTHER COMPREHENSIVE INCOME: Foreign currency translation gain (loss) (402)$ 862 $ (1,608) Amount reclassified to earnings 4,205 COMPREHENSIVE INCOME $ 23,169 $ 58,279 $ 114,905 EARNINGS PER SHARE: Basic s $ 0.25 s 0.25% 0.73 0.73 $ $ 1.39 1.38 Diluted WEIGHTED AVERAGE SHARES OUTSTANDING: Basic 78,592 78,669 83.90 Diluted 78,870 79,049 84,591 See notes to consolidated financial statements.

Answer 1

Inventory
Beg. Bal.	241424
Purchases**	1497644	1472797	Cost of goods sold*
End. Bal.	266271

*Cost of goods sold = $1522797 - $50000 = $1472797

**Purchases = $1472797 + $266271 - $241424 = $1497644

The company bought inventory of $1,497,644.