Beginning inventory Merchandise Finished goods Cost of merchandise purchased Cost of goods manufactured Ending inventory Bare Unimart Manufacturing $ 342,000 440,000 $ 684,000 242,000 800,000 Merchandise Finished goods Compute cost of goods sold for each of these two companies. 236,000
Cost of Goods sold of a Manufacturing Company:
Cost of goods sold in a manufacturing company means the cost of goods sold by it during a particular period (say in a year). Cost of goods sold helps in calculation of gross margin and consequently the net profit in a company.
Cost of goods sold is calculated by reducing value of ending inventory of finished goods from the cost of goods available for sale.
Cost of goods available for sale is calculated by adding the beginning inventory of finished goods and cost of goods manufactured.
Cost of Goods sold of a Trading Company:
Cost of goods sold in a trading company means the cost of goods sold by it during a particular period (say in a year). Cost of goods sold helps in calculation of gross margin and consequently the net profit in a company.
Cost of goods sold is calculated by reducing value of ending inventory of finished goods from the cost of goods available for sale.
Cost of goods available for sale is calculated by adding the beginning inventory of finished goods and cost of goods purchased during the period.
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