The following details relate to a perpetual inventory system: What was the value of opening inventory?

Question

The following details relate to a perpetual inventory system:  What was the value of opening inventory?

Quizplus · Accepted Answer

The perpetual inventory system requires the recording of inventory changes in real-time. Therefore, the opening inventory value can be calculated by subtracting the cost of goods sold from the sum of the beginning inventory and purchases. From the given information, we can calculate the opening inventory as follows:
Beginning Inventory + Purchases - Cost of Goods Sold = Ending Inventory
$612,000 + $402,000 - $708,000 = $306,000
Therefore, the value of opening inventory was $306,000.

The Following Details Relate to a Perpetual Inventory System