Question

Question 1
Sales of finished goods by a business for the year ended 30 June 2018 were $240,000, the selling price showing a mark-up of 50% on cost. The finished goods inventory as at 1 July 2017, valued at cost, was $60,000 and at 30 June 2018 was $10,000. What was the cost of goods manufactured for the year ended 30th June 2018?
	Calculations
Opening FG
Closing FG
COGS
COGM

Please provide full explanations and solution. Thanks!

Answer 1

given that selling price = $ 240,000

mark up on cost = 50 %

finished goods opening value = $60,000

finished goods closing value = $10,000

solution :

let cost selling product = 100

add mark up(50% = 50

total sale price = 150

so cost of goods sold/purchase price = (240,000 /150) x 100

=160,000

so cost of goods manufactured = opening stock + purchase price - closing inventory

= 60,000 + 160,000 - 10,000

= $210,000