Pittsburgh Company pays cash for all inventory purchases.The company had a beginning inventory of $18,500 and an ending inventory of $16,900.Their cost of goods sold amounted to $75,000.Based on this information,what was the amount of cash paid for inventory purchases?

Question

Quizplus · Accepted Answer

Ending balance of inventory of $16,900 = Beginning balance of inventory of $18,500 + Increase due to inventory purchases for cash (the unknown)- Decrease due to cost of goods sold of $75,000
Inventory purchases for cash = $16,900 - $18,500 + $75,000 = $73,400

Pittsburgh Company Pays Cash for All Inventory Purchases