Question

Errors in Inventory Counts The following information was taken from the records of Taylor Enterprises:

	2013	2012
Beginning inventory	$70,000	$60,000
Cost of goods purchased	430,000	410,000
Cost of goods available for sale	500,000	470,000
Ending inventory	65,000	70,000
Cost of goods sold	$435,000	$400,000

The following two errors were made in the physical inventory counts:
1. 2012 ending inventory was understated by $10,000.
2. 2013 ending inventory was overstated by $5,000.
Compute the correct cost of goods sold for both 2012 and 2013.

	2013	2012
Cost of goods sold	$ Answer	$ Answer

Answer 1

	2013	2012
Beginning Inventory(Corrected Balance)	$                         80,000	$                   60,000
Cost of goods purchased	$                       430,000	$                 410,000
Cost of goods available for sale	$                       510,000	$                 470,000
Ending Inventory(Corrected Balance)	$                         60,000	$                   80,000
Cost of goods sold(Corrected)	$                       450,000	$                 390,000