Use the following letters to represent items: P = Purchases net)
C = Cost of goods sold B = Beginning inventory E = Ending inventory
Which equation is correct?
A) B − C + P = E
B) B − E = C + P
C) P − E = B + C
D) B = C − E + P

Question

Quizplus · Accepted Answer

A) B − C + P = E is the correct equation when rearranged from the basic formula for calculating the cost of goods sold (COGS), which is C = B + P - E.

Use the Following Letters to Represent Items: P = Purchases