Cox Merchandising Company began the year with merchandise inventory of $60,000, ended the year with merchandise inventory of $70,000, and had cost of goods sold of $110,000.What was the Cox Merchandising Company's net purchases for the year?
A)$100,000
B)$110,000
C)$120,000
D)$130,000
E)none of the above

Question

Quizplus · Accepted Answer

Net purchases can be calculated by using the following formula:
Net Purchases = Cost of Goods Sold + Ending Inventory - Beginning Inventory
Using the given numbers, we can calculate net purchases as:
Net Purchases = $110,000 + $70,000 - $60,000
Net Purchases = $120,000
Therefore, the answer is option C.

Cox Merchandising Company Began the Year with Merchandise Inventory of $60,000