Question

1) Calculate the missing amounts for each company Sales Beginning Inventory Ending Gross COGS Profit Inventory Purchases $20,000 $25,000 entory $65,000 $22,000 $30,000 $20,000$50,000 S35,000 Company 1 $100,000 $140,000 $45,000 Company 2 Company 3 Company 4 $45,000 $85,000 $10,000 $30,000 $35,000

Answer 1

Company 1:-

A. Calculations for Cost of Goods Sold:-

Cost of Goods Sold calculate by adding opening Inventory and Inventory Purchases and deduct Ending Inventory.

Cost of Goods Sold=(Beginning Inventory+Inventory Purchases-Ending Inventory)

=$(20,000+65,000-22,000)=$(85,000-22,000)

=$63,000

B. Calculations for Gross Profit:-

Gross Profit Calculate by Sales minus Cost of Goods Sold.

Gross Profit=(Sales-Cost of Goods Sold)

=$(100,000-63,000)

=$37,000

Company 2:-

D. Calculations for Cost of Goods Sold:-

Cost of Goods Sold=(Sales-Gross Profit)

=$(140,000-45,000)

=$95,000

C. Calculations for Inventory Purchases:-

Cost of Goods Sold=(Beginning Inventory+Purchases-Ending Inventory)

or Cost of Goods Sold- Beginning Inventory+Ending Inventory=Purchases

Or Inventory Purchases=(Cost of Goods Sold- Beginnig Inventory Ending Inventory)

=$(95,000-25,000+30,000)=$(70,000+30,000)

=$100,000

Company 3:-

E. Calculations for Sales:-

Sales=(Cost of Goods Sold+Gross Profit)

=$(50,000+35,000)

=$85,000

F. Calculations for Beginning Inventory:-

Beginning Inventory=(Cost of Goods Sold- Purchases+Ending Inventory)

=$(50,000-45,000+20,000)=$(5,000+20,000)

=$25,000

Company 4.

G. Calculations for Ending Inventory:-

Ending Inventory=( Beginning Inventory+Purchases- Cost of Goods Sold)

=$(10,000+30,000-35,000)=$(40,000-35,000)

=$5,000

H. Calculations for Gross Profit:-

Gross Profit=(Sales- Cost of Goods Sold)

=$(85,000-35,000)

=$50,000