Question

Unimart Precision Manufacturing Beginning inventory Merchandise $ 234,000 Finished goods $ 468,000 Cost of purchases 420,000 Cost of goods manufactured 760,000 Ending inventory Merchandise 134,000 Finished goods 128,000 Compute cost of goods sold for each of these two companies for the year

Answer 1

A. Unimart Cost of goods sold $520,000

B. Precision Manufacturing Cost of goods sold $1,100,000

Step-by-step explanation:

Computation for the cost of goods sold for each of these two companies for the year

a) Computation for the cost of goods sold for UNIMART

UNIMART Partial income statement For the year ended December 31

COST OF GOODS SOLD:

Beginning merchandise inventory $ 234,000

Add Cost of purchase $420,000

Goods available for sale $654,000

($234,000+$420,000)

Less: Ending merchandise inventory ($134,000)

Cost of goods sold $520,000

($654,000-$134,000)

Therefore the Cost of goods sold for UNIMART $520,000

b) Computation for the cost of goods sold for PRECISION MANUFACTURING

PRECISION MANUFACTURING

Partial income statement For the year ended December 31

COST OF GOODS SOLD:

Beginning finished goods inventory $ 468,000

Add Cost of manufactured $760,000

Goods available for sale $1,228,000

($468,000+$760,000)

Less: Ending finished goods inventory ($128,000)

Cost of goods sold $1,100,000

($1,228,000-$128,000)

Therefore the Cost of goods sold for PRECISION MANUFACTURING is $1,100,000