In 20B, Landings Inc. provided the following items in their footnotes. Its cost of goods available for sale was $6.2 billion under FIFO costing and its ending inventory value under FIFO costing was $2.1 billion. Its opening inventory was $2.5 billion. What was its purchases?
A) $3.7 billion
B) $8.3 billion
C) $4.6 billion
D) $4.1 billion

Question

Quizplus · Accepted Answer

The cost of goods available for sale is calculated as opening inventory plus purchases. Therefore, purchases = cost of goods available for sale - opening inventory = $6.2 billion - $2.5 billion = $3.7 billion.