Question

A company provided the following data: sales, $500,000; beginning inventory, $40,000; ending inventory, $45,000; and gross profit, $150,000. What was the amount of inventory purchased during the year?

Answer 1

Explanation:

Revenue minus cost of sales is equal to gross profit

so inventory purchase, beginning inventory and ending inventory are in cost of sales

Formula will be Revenu-cost of sales (beginning inventory + purchased inventory - ending inventory )=Gross profit

So 500000-(40000+x-45000)=150000

then you can make x as the subjects of the formula and you can easily get the answer