Question

Deal Corp.'s 2004 cost of goods sold: Inventory, 12/31/03 $ 90,000 2004 purchases 124,000 2004 write-off of obsolete inventory 34,000 Inventory, 12/31/04 30,000 The inventory written off became obsolete due to an unexpected and unusual technological advance by a competitor. In its 2004 income statement, what amount should Deal report as cost of goods sold?

Answer 1

$150,000

Step-by-step explanation:

Data given in the question

Opening inventory = $90,000

Purchase = $124,000

Written off amount = $34,000

Ending inventory = $30,000

The computation of the cost of goods sold is shown below:

Cost of goods sold = Opening inventory + purchase made - written off amount of obsolete inventory - ending inventory

= $90,000 + $124,000 - $34,000 - $30,000

= $150,000