Morris Company manufacturers computer stands. What is the beginning balance of Finished Goods Inventory if Cost of Goods Sold is $107,000; the ending balance of Finished Goods Inventory is $20,000; and Cost of Goods Manufactured is $50,000 less than Cost of Goods Sold?

Question

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The beginning balance of Finished Goods Inventory is $70,000. This is calculated by adding the ending balance of Finished Goods Inventory ($20,000) to the Cost of Goods Sold ($107,000) and then subtracting the Cost of Goods Manufactured ($50,000 less than Cost of Goods Sold).

Morris Company Manufacturers Computer Stands