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A company provided the following data: sales, $500,000; beginning inventory, $40,000; ending...

Question:

A company provided the following data: sales, $500,000; beginning inventory, $40,000; ending inventory, $45,000; and gross profit, $150,000. What was the amount of inventory purchased during the year?

a. $385,000

b. $355,000

c. $345,000

d. $145,000.

Inventory in Accounting:

Inventory is the asset of the company which is later sold to customers in return for income. Cost of goods sold consists of inventory at beginning, inventory purchased during the year minus inventory at end of the year. This is the cost for selling the goods during the year and is subtracted from the sales to get the gross profit.

Answer and Explanation: 1

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The amount purchased during the year is $355,000.

The formula for finding the gross profit is:

Gross profit = Sales - (beginning inventory +...

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What Is Inventory? - Definition & Example

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Chapter 13 / Lesson 7
25K

Learn what inventory in business is. Find out three types of inventory management systems and the benefits of each. Understand inventory management through examples.


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