Delta Merchandising,Inc.,has provided the following information for the year just ended:
$\begin{array} { l r }
\text { Net sales } & \$ 128,500 \
\text { Beginning inventory } & \$ 24,000 \
\text { Purchases } & \$ 80,000 \
\text { Gross margin } & \$ 38,550
\end{array}$
What was the ending inventory for the company at year-end?
A) $65,450.
B) $24,500.
C) $14,050.
D) $9,950.

Question

Delta Merchandising,Inc.,has provided the following information for the year just ended: 
$\begin{array} { l r } 
\text { Net sales } & \$ 128,500 \
\text { Beginning inventory } & \$ 24,000 \
\text { Purchases } & \$ 80,000 \
\text { Gross margin } & \$ 38,550
\end{array}$
What was the ending inventory for the company at year-end?
A) $65,450.
B) $24,500.
C) $14,050.
D) $9,950.

Quizplus · Accepted Answer

To find the ending inventory, we first calculate the cost of goods sold (COGS) using the formula: COGS = Net Sales - Gross Margin = $128,500 - $38,550 = $89,950. Then, use the inventory formula: Ending Inventory = Beginning Inventory + Purchases - COGS = $24,000 + $80,000 - $89,950 = $14,050.

Delta Merchandising,Inc What Was the Ending Inventory for the Company at Year-End