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At the beginning of the year, Uptown Athletic had an inventory of $640000. During the year, the company purchased goods costing $2020000. If Uptown Athletic reported ending inventory of $960000 and sales of $3440000, their cost of goods sold and gross profit rate would be:

Respuesta :

TomShelby

Answer:

Cost of Goods Sold = $1,700,000

Gross Proft = $1,740,000

Explanation:

We solve this assingemtn using the inventory identity:

[tex]$Beginning Inventory + Purchase = Ending Inventory + COGS[/tex]

We post the given and solve for the missing part:

640,000 + 2,020,000 = 960,000 + COGS

COGS = 640,000 + 2,020,000 - 960,000 = 1,700,000

Next we use the COGS value to calculate the gross profit.

[tex]Sales \: Revenues- \: COGS = \: Gross \: Profit[/tex]

3,440,000 - 1,700,000 = 1,740,000

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