Given the following data, what is the cost of purchases?
$\begin{array} { l r }
\text { Sales revenue } & \$ 725,000 \
\text { Cost of goods sold } & 345,000 \
\text { Ending inventory } & 250,000 \
\text { Beginning inventory } & 120,000
\end{array}$

Question

Given the following data, what is the cost of purchases?
$\begin{array} { l r } 
\text { Sales revenue } & \$ 725,000 \
\text { Cost of goods sold } & 345,000 \
\text { Ending inventory } & 250,000 \
\text { Beginning inventory } & 120,000
\end{array}$

Quizplus · Accepted Answer

The cost of purchases can be calculated using the formula: Cost of Goods Sold (COGS) = Beginning Inventory + Purchases - Ending Inventory. Rearranging the formula to solve for Purchases gives: Purchases = COGS - Beginning Inventory + Ending Inventory. Plugging in the given values: Purchases = $345,000 - $120,000 + $250,000 = $475,000.

Given the Following Data, What Is the Cost of Purchases