Calculate the cost of goods sold.
Question # 1:
A retailer has yearly sales of $650,000. Inventory on January 1 is $250,000 (at cost). During the year, $500,000 of merchandise (at cost) is purchased. The ending inventory is $275,000 (at cost). Operating costs are $90,000.
- a. Calculate the cost of goods sold
- b. Calculate the net profit
Question # 2:
A retailer has a beginning monthly inventory valued at $60,000 at retail and $35,000 at cost. Net purchases during the month are $140,000 at retail and $70,000 at cost. Transportation charges are $17,000. Sales are $150,000. Markdowns and discounts equal $20,000. A physical inventory at the end of the month shows merchandise valued at $10,000 (at retail) on hand. Compute the following:
- a. Total merchandise available for sale – at cost and at retail
- b. Cost complement
- c. Ending retail book value of inventory
- d. Stock shortages
- e. Adjusted ending retail book value
- f. Gross profit
Question # 3:
A car dealer purchased multiple –disc CD players for $1185 each and desires a 40% markup (at retail). What retail price should be charged?
