Question

Martock Company uses the periodic inventory system. The following information is available for the period ending December 31: (1) Sales: $30,000 (2) Beginning inventory: $17,500 (3) Ending inventory: $8,000 (4) Purchases: $10,000. The cost of goods sold for the period is:

a) $8,500
b) $10,500
c) $15,500
d) $20,500

Answer 1

To calculate the cost of goods sold, subtract the ending inventory from the sum of beginning inventory and purchases.

Step-by-step explanation:

To calculate the cost of goods sold, we need to subtract the ending inventory from the sum of the beginning inventory and purchases. Beginning inventory is $17,500 and purchases are $10,000, so the total inventory available is $17,500 + $10,000 = $27,500.

Then, we subtract the ending inventory of $8,000 from the total inventory available to get the cost of goods sold: $27,500 - $8,000 = $19,500.

Therefore, the cost of goods sold for the period is $19,500.