All purchases of inventory are for cash. If inventory at the beginning of the year is $63,000 and at the end is $88,000 and the cost of sales is $200,000, the cash paid for inventory purchased for the year is:
A) $225,000
B) $200,000
C) $175,000
D) none of the above

Question

Quizplus · Accepted Answer

To find the cash paid for inventory, we use the formula: Cash Paid for Inventory = Cost of Sales + Ending Inventory - Beginning Inventory. Plugging in the given values: $200,000 + $88,000 - $63,000 = $225,000.

All Purchases of Inventory Are for Cash