Question

A company using the periodic inventory system has the following account balances: Inventory at the beginning of the year, $4,437; Freight-In, $567; Purchases, $13,447; Purchases Returns and Allowances, $2,866; Purchases Discounts, $493. The cost of merchandise purchased is equal to ________.

Answer 1

Answer:

$10,581

Explanation:

Given that

Purchase = $13,447

Purchases Returns and Allowances = $2,866

Purchases Discounts = $493

Freight in = $567

The computation of cost of merchandise purchased is shown below:-

Net Purchase = Purchase - Purchases Returns and Allowances - Purchases Discounts

= $13,447 - $2,866 - $567

= $10,014

Cost of merchandise purchased = Net purchase + Freight in

= $10,014 + $567

= $10,581