A fire destroyed some of Cholla,Inc.'s records.Information from the documents found related to inventory is listed below. What was the amount of inventory that was purchased during the year?
A)$860,400
B)$1,017,000
C)$741,600
D)$898,200

Question

A fire destroyed some of Cholla,Inc.'s records.Information from the documents found related to inventory is listed below.  What was the amount of inventory that was purchased during the year?
A)$860,400 
B)$1,017,000 
C)$741,600 
D)$898,200

Quizplus · Accepted Answer

Cost of goods sold = Beginning inventory + Purchases − Ending inventory
Purchases = Cost of Goods Sold − Beginning Inventory + Ending Inventory
= $801,000 − $77,400 + $136,800 = $860,400
Consignment inventory is not owned by the company and is not considered in the Cost of Goods Sold equation.

A Fire Destroyed Some of Cholla,Inc