Monte Vista uses the perpetual inventory system.At the beginning of the quarter,Monte Vista has $60,000 in inventory.During the quarter the company purchases $15,800 of new inventory from a vendor,returned $1,400 of inventory to the vendor,and took advantage of discounts from the vendor of $400.At the end of the quarter the balance in inventory is $53,000.What is the cost of goods sold?
A)$21,000
B)$22,800
C)$7,000
D)$23,800

Question

Quizplus · Accepted Answer

Net Purchases = Purchases − Purchase returns − Purchase discounts
= $15,800 − $1,400 − $400 = $14,000
Cost of goods sold = Beginning inventory + Net purchases − Ending inventory
= $60,000 + $14,000 − $53,000 = $21,000

Monte Vista Uses the Perpetual Inventory System