Oakwood Company uses a periodic inventory system. The December 31, 2018, year-en
ID: 2522759 • Letter: O
Question
Oakwood Company uses a periodic inventory system. The December 31, 2018, year-end trial balance for the company contained the following information: Account Debit Credit Freight-in $14,580 Merchandise inventory, 12/31/18 47,710 Merchandise inventory, 1/1/18 38,440 Purchases 246,520 Purchase discounts $6,630 Purchase returns 10,600 Sales 168,320 Sales returns 18,560 What is Oakwood Company’s cost of goods sold for the year ending December 31, 2018? Oakwood Company uses a periodic inventory system. The December 31, 2018, year-end trial balance for the company contained the following information: Account Debit Credit Freight-in $14,580 Merchandise inventory, 12/31/18 47,710 Merchandise inventory, 1/1/18 38,440 Purchases 246,520 Purchase discounts $6,630 Purchase returns 10,600 Sales 168,320 Sales returns 18,560 What is Oakwood Company’s cost of goods sold for the year ending December 31, 2018?Explanation / Answer
Cost of goods sold = Opening Stock +Net Purchases - Closing stock
Net purchases = Purchases - Purchase discounts - Purchase returns = 246520 - 6630 - 10600 = $229,290
Therefore the cost of goods sold for the year ending december 31,2018 = 38440 + 229290 - 47710 = $220,020
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