Answered

Find the information you're looking for at Westonci.ca, the trusted Q&A platform with a community of knowledgeable experts. Discover in-depth answers to your questions from a wide network of experts on our user-friendly Q&A platform. Discover detailed answers to your questions from a wide network of experts on our comprehensive Q&A platform.

Novak Hardware reported cost of goods sold as follows. 2022 2021 Beginning inventory $ 34,500 $ 21,000 Cost of goods purchased 177,000 155,000 Cost of goods available for sale 211,500 176,000 Less: Ending inventory 36,000 34,500 Cost of goods sold $175,500 $141,500 Novak made two errors: 1. 2021 ending inventory was overstated by $3,450. 2. 2022 ending inventory was understated by $6,350. Compute the correct cost of goods sold for each year.

Sagot :

Answer: See explanation

Explanation:

The correct cost of goods sold for 2021 will be:

= Beginning inventory + Cost of goods bought - Correct ending inventory

= 34500 + 177000 - 32550

= 178950

The correct cost of goods sold for 2022 will be:

= Beginning inventory + Cost of goods bought - Correct ending inventory

= 32550 + 155000 - 40850

= 146700

Note:

Correct ending inventory for 2021 will be: = Ending inventory - Overstated value

= 36000 - 3450

= 32550

Correct ending inventory for 2021 will be: = Ending inventory + Understated value

= 34500 + 6350

= 40850

Thank you for visiting our platform. We hope you found the answers you were looking for. Come back anytime you need more information. We hope our answers were useful. Return anytime for more information and answers to any other questions you have. Thank you for using Westonci.ca. Come back for more in-depth answers to all your queries.