Question

The Playa Company uses a periodic inventory system. The following information is taken from Playa's records. Certain data have been intentionally omitted. ($ inthousands)

Required:
Determine the missing numbers. (Enter your answers in thousands.)

2011 2012 2013
Beginning inventory _____ _____ 225
Cost of goods sold 627 621 _____
Ending inventory _____ 225 216
Cost of goods available for sale 876 _____ 800
Purchases (gross) 630 _____ 585
Purchase discounts 18 15 _____
Purchase returns 24 30 14
Freight-in 13 32 16

Answer 1

Hi,

Please find the answer as follows;

	2013	2014	2015
Beginning Inventory	284	267	270
Cost of Goods Sold	654	630	593
Ending Inventory	267	270	234
Cost of Goods Available for Sale	921	900	827
Purchases	675	655	630
Purchase Discounts	27	24	75
Purchase Returns	33	39	23
Frieght-in	22	41	25

(2013) Calculations:

Cost of Goods Available for Sale = Beginning Inventory + Net Purchases

921 = Beginning Inventory + (675 -27-33+22)

Beginning Inventory = 284

Ending Inventory = Cost of Goods Available for Sale - Cost of Goods Sold = 921 - 654 = 267

2014 (Calculations)

Beginning Inventory = 267 (2013's closing inventory)

Cost of Goods Available for Sale = Cost of Goods Sold + Ending Inventory = 630 + 270 = 900

Cost of Goods Available for Sale = Beginning Inventory + Net Purchases

900 = 267 + (Gross Purchases - 24 - 39 +41)

Gross Purchases = 655

2015 (Calculations)

Cost of Goods Sold = Cost of Goods Available for Sale - Ending Inventory = 827 - 234 = 593

Cost of Goods Available for Sale = Beginning Inventory + Net Purchases

827 = 270 + (630 - Purchase Discounts - 23 + 25)

Purchase Discounts = 75

Thanks.