Golden Oak Antique Shop has the following account balances at the end of the current accounting period. $$\begin{array} { | l | r | }
\hline \text { Beginning inventory } & \$ 73,250 \
\hline \text { Net purchases } & 57,650 \
\hline \text { Net sales revenue } & 85,500 \
\hline
\end{array}$$ A normal gross profit for the company is $45%.What is the company's estimated cost of goods sold for the accounting period?

Question

Golden Oak Antique Shop has the following account balances at the end of the current accounting period. $$\begin{array} { | l | r | } 
\hline \text { Beginning inventory } & \$ 73,250 \
\hline \text { Net purchases } & 57,650 \
\hline \text { Net sales revenue } & 85,500 \
\hline
\end{array}$$ A normal gross profit for the company is $45%.What is the company's estimated cost of goods sold for the accounting period?

Quizplus · Accepted Answer

The estimated cost of goods sold (COGS) can be calculated by first determining the gross profit, which is typically 45% of the net sales revenue. Net sales revenue is $85,500, so the gross profit is 45% of that, which equals $38,475. To find the COGS, subtract the gross profit from the net sales revenue: $85,500 - $38,475 = $47,025.

Golden Oak Antique Shop Has the Following Account Balances at the End