Carp Corporation has provided the following information for its most recent month of operation: sales $16,000;ending inventory $4,000,purchases $8,000 and gross profit $10,000.How much was Carp's beginning inventory?
A)$2,000.
B)$18,000.
C)$6,000.
D)$12,000.

Question

Quizplus · Accepted Answer

The beginning inventory can be calculated using the formula: Beginning Inventory = Ending Inventory + Cost of Goods Sold (COGS) - Purchases. Given that Gross Profit = Sales - COGS, we can rearrange to find COGS = Sales - Gross Profit = $16,000 - $10,000 = $6,000. Therefore, Beginning Inventory = $4,000 + $6,000 - $8,000 = $2,000.

Carp Corporation Has Provided the Following Information for Its Most