Question

Gabat Inc. is a merchandising company. Last month the company's merchandise purchases totaled $67,000. The company's beginning merchandise inventory was $19,000 and its ending merchandise inventory was $22,000. What was the company's cost of goods sold for the month?

Answer 1

Answer:

$64,000 COST OF GOODS SOLD

Explanation:

Beginning Inventory + Purchase =  Ending Iventory + Cost of Goods Sold

The first two represent the available goods for sale

(what we had plus we we bring during the period)

The second part is what happened:

How much we sold and how much we keep to next cycle.

Posting in the formula the know values:

67,000 + 19,000 = 22,000 + COGS

67,000+19,000 - 22,000 = COGS

Solving for the unknow values

64,000 = cogs