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When dealing with COGS, how do you calculate ending inventory when you are only provided with sales, beginning inventory, and purchases?
Expert Answer
Cost of Goods Means the net amount of goods which are sold by an enterprise during a period.
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Question & Answer: When dealing with COGS, how do you calculate ending inventory when you are only provided with sales, beginning inventory, and purchases?…..
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It can be calculated as follows:
| Beginning Inventory | XX |
| Add: Purchases during the period | XX |
| Total Inventory Available for Sale | XX |
| Less: Closing Inventory | XX |
| Cost of Goods Sold(COGS) | XX |
When Sales, Beginning Inventory and Purchases are given, we can calculate the Ending inventory as follows:
| Beginning Inventory | XX |
| Add: Purchases during the period | XX |
| Total Inventory Available for Sale | XX |
| Less: Inventory Sold | XX |
| Closing Inventory | XX |
Any of the above variables can be calculated with making the changes in the above format.
