Opening Stock +Purchases-Closing Stock = Cost of Goods Sold / Sales
When will it be equal to Cost of Goods Sold and when to Sales
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Cost of Goods Sold or Sales
Replies (3)
If there is no profit, then it will be equal to cost of good sold and when there is profit, then it will be equal tosales ...
simple
Hi, I’m new to accounting and trying to solve a text book problem. Can anyone help me in understanding how the author calculated purchase (36,000) in Cost of goods sold?
Question:
Direct labor cost 16,000
Cost of goods sold 56,000
Opening and Closing Balances
Raw Material 8,000 8,600
Work-in-progress 8000 12,000
Finished goods 14,000 18,000
Selling expenses 3,400
General Admin 2,600
Sales for the month 75,000
Solution given:
A) Sales (given) 75,000
B) Cost of goods sold:
Raw Materials Consumed:
Opening stock (given) 8,000
Purchase (balancing figure) 36,000
44,000
Closing stock (8,600) 35,400
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