Which of the following is necessary for computing cost of goods sold but not necessary for computing the cost of goods available for sale?
A)Freight-in
B)Purchases
C)Ending merchandise inventory
D)Beginning merchandise inventory

Question

Quizplus · Accepted Answer

To compute the cost of goods sold, ending merchandise inventory is deducted from the cost of goods available for sale. However, beginning merchandise inventory is already included in the cost of goods available for sale calculation. Freight-in and purchases are both needed to determine the total cost of goods available for sale.

Which of the Following Is Necessary for Computing Cost of Goods