How To Calculate Cost of Goods Sold With And Without Beginning Or Ending Inventory
How To Find Cost of Sales With Beginning And Ending Inventory
Here, Firstly, we calculate Cost of Goods Sold (Cost of Sales) by giving the value of opening inventory and closing inventory and then without the beginning inventory and ending inventory with other given information.1. Calculation of Cost of Goods Sold With Beginning Or Ending Inventory
Calculate Cost of Goods Sold / Cost of Sales, If following are given:
Sales = Rs. 108000, Opening Inventory or Stock = 50000, Purchases = Rs. 70000 and Ending Inventory or Stock = Rs. 70000
Rs.
Sales 108000
- Cost of Sales
Opening Inventory 50000
+ Purchases 70000
- Closing Inventory 30000
________ (90000)
________
Gross Income / Gross Profit 18000
________
________
If the company’s owners just started the business, then there is no opening inventory as it is the first accounting period of the business.
2. Calculation of Cost of Goods Sold Without Beginning And Ending Inventory
Given:-
Sales = Rs. 1200000, Rate of Gross Profit On Cost = 20%
Required: Cost of Goods Sold
We know that:
Sales = Cost of Sales + Gross Profit
Cost of Sales = Sales - Gross Profit
Cost of Sales = 120000 - 20000 = Rs. 100000
Here Gross Profit Rate = 20%, Cost of Sales Rate = 100 And Sales Rate = 120
Gross Profit = 20/120 X 1200000 = Rs. 20000
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