Appendix EX 6-34 Cost of merchandise sold

Based on the following data, determine the cost of merchandise sold for November:


Merchandise inventory, November 1 $ 28,000
Merchandise inventory, November 30 31,500
Purchases 475,000
Purchases returns and allowances 15,000
Purchases discounts 9,000
Freight in 7,000






Answer:

Cost of merchandise sold:
Merchandise inventory, November 1 $ 28,000
Purchases $475,000
Less: Purchases returns and
allowances $15,000
Purchases discounts 9,000 24,000
Net purchases $451,000
Add freight in 7,000
Cost of merchandise purchased 458,000
Merchandise available for sale $486,000
Less merchandise inventory, November 30 31,500
Cost of merchandise sold $454,500