Classic Autos specializes in selling gently used specialty sports cars and uses the specific identification method of determining ending inventory and cost of goods sold. Item 507K was sold for $90,000. Classic purchased the sports car for $50,000 and paid $1,800 for freight in and $1,000 for freight out. What is the cost of goods sold?

Question

Quizplus · Accepted Answer

The cost of goods sold (COGS) includes the purchase price of the car ($50,000) and the freight in costs ($1,800) for a total of $51,800. Freight out costs are not included in COGS.

Classic Autos Specializes in Selling Gently Used Specialty Sports Cars