Question

Based on the following data,Determine the cost of merchandise sold for november

Particulars	Amount$
Increased in estimated returns inventory	14,500
Merchandise inventory,november 1	28,000
Merchandise inventory, november 30	31,500
Purchases	4,75,000
Purchases returns and allowances	15,000
Purchases discounts	9,000
Freight in	7,000

Answer 1

The cost of goods sold reflects the expenses incurred for the inventory that the company sold over a given time period.

Calculation of cost of merchandise sold

For the month of november

Particulars	Amount$	Amount$
Merchandise inventory,november 1		28,000
Cost of merchandise purchased
Purchases	4,75,000
Less : Purchase returns & allowances	15,000
Less : Purchase discounts	9,000
Net Purchases	4,51,000
Add : Freight in	7,000
Total cost of merchandise purchased		4,58,000
Cost of merchandise available for sale		4,86,000
Less : Merchandise inventory, november 30		31,500
Cost of merchandise sold before estimated returns		4,54,500
Less : Increase in estimated return inventory		14,500
Cost of merchandise sold		4,40,000

Therefore , cost of goods sold ins $4,40,000