Chapter 5, Problem 40E

Identify items missing in determining cost of goods sold

For (a) through (e), identify the items designated by X and Y.

1. A. Purchases − (X + Y) = Net purchases
2. B. Net purchases + X = Cost of inventory purchased
3. C. Inventory (beginning) + Cost of inventory purchased = X
4. D. Inventory available for sale − X = Cost of inventory before estimated returns
5. E. Cost of goods sold before estimated returns − X = Cost of goods sold