Question

A company began its fiscal year with inventory of $205,000. Purchases and cost of goods sold for the year were $964,000 and $998,000, respectively. What was the amount of ending inventory?

Answer 1

171,000 dollars is the answer.

Step-by-step explanation:

1. ($998,000 - $964,000 = $34,000)

2. $205,000 - $34,000 = $171,000

Answer 2

The amount of ending inventory of the company is
`\bold{\$171,000}`

Step-by-step explanation:

If we sell any product, we will have remaining some products at the end of the accounting period. These products have a particular value, which is called the ending inventory.

Given, Initial inventory in the beginning of the fiscal year =
`\bold{\$205,000}`

Purchase made for the year =
`\bold{\$964,000}`

Cost of goods sold for the year (sales) =
`\bold{\$998,000}`

To find, the amount of ending inventory we have to use the following formula,

`\bold{\text { Inventory }+\text { Net Purchases - cost of Goods Sold (or } \ COGS)=\text { Ending Inventory }}`

`\bold{\Rightarrow \$205,000 - \$998,000 + \$964,000 = \$171,000}`