Question

Red Vanilla, Inc. reported the following year-end information: beginning work inprocess inventory, $180,000; cost of goods manufactured, $716,000; beginning finishedgoods inventory, $252,000; ending work in process inventory, $220,000; and endingfinished goods inventory, $264,000. Red Vanilla, Inc.'s cost of goods sold for the year is

Answer 1

Cost of Goods Sold 704,000

Step-by-step explanation:

We will solve using the inventory identity:

`$$Beginning Inventory + COGM = Ending Inventory + COGS`

beginning finished goods 252,000

Cost of Goods Manufactured 716,000

Ending finished goods (264,000)

Cost of Goods Sold 704,000

As the Work in Process is not part of the formula we ignore this data.