The balance in Kayser Manufacturing Company's Finished Goods account at November 30 was $825,000. Its November cost of goods manufactured was $2,350,000 and its cost of goods sold in November was $2,455,000. What was the balance in Kayser's Finished Goods at November 1?

Question

Quizplus · Accepted Answer

Cost of goods manufactured added to Finished Goods at the beginning of the month results in the finished goods available for sale. At the end of the month, these goods either remain in Finished Goods or are sold, which results in Cost of Goods Sold, so the total of ending Finished Goods and Cost of Goods Sold is also the finished goods available for sale. Therefore, the equation can be rearranged to compute the beginning balance in Finished Goods as follows:
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The Balance in Kayser Manufacturing Company's Finished Goods Account at November