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23 February, 05:07

In 2010, the BowWow Company purchased 11,752 units from its supplier at a cost of $ 11.73 per unit. BowWow sold 18,971 units of its product in 2010 at a price of $ 24.86 per unit. BowWow began 2010 with $ 864,593 in inventory (inventory is carried at a cost of $ 11.73 per unit). Using this information, compute BowWow's 2010 ending inventory balance (in dollars).

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  1. 23 February, 05:23
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    Ending inventory balance is $ 779,914.13

    Explanation:

    The cost of goods sold formula can be used to determine the ending inventory by rearranging the formula and making the ending inventory the subject of the formula:

    cost of goods=beginning inventory+inventory purchased-ending inventory

    ending inventory=beginning inventory+inventory purchased-costs of goods sold

    ending inventory=$864,593 + (11,752*$11.73) - (18971*$11.73) = $ 779,914.13
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