Errors in Inventory Counts The following information was taken from the records

Question

Errors in Inventory Counts The following information was taken from the records of Spencer Enterprise 2013 2012 $63,000 $83,000 548,000 508,000 Cost of goods available for sale 611,000 591,000 93,000 63,000 $518,000 $528,000 Beginning inventory Cost of goods purchased Ending inventory Cost of goods sold The following two errors were made in the physical inventory counts: 1. 2012 ending inventory was overstated by $33,000 2. 2013 ending inventory was understated by $28,000. Compute the correct cost of goods sold for both 2012 and 2013. 2013 2012 Cost of goods sold Check

Explanation / Answer

Calculate cost of goods sold :

2013 2012 Beginning inventory 30000 83000 Cost of goods purchased 548000 508000 Cost of goods available for sale 578000 591000 Ending inventory (121000) (30000) Cost of goods sold 457000 561000

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