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16 July, 07:42

Kennel Company reported the following: Cost of goods sold (estimated for next period) $300,000 Ending inventory (estimated for next period) $95,000 Beginning inventory for the period $60,000 Based on this information, the purchases for the next period should be:

A. $265,000.

B. $360,000.

C. $395,000.

D. $335,000.

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  1. 16 July, 08:14
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    Answer: option d

    Explanation: In simple words, purchases refers to the amount of resources taken in by the organisation in return for paying money or incurring a liability to pay in future.

    It can be computed using following formula : -

    Purchases = cost of goods sold - opening stock + closing stock'

    Putting the values into equation we get : -

    Purchases = $300,000 - $60,000 + $95,000

    = $335,000
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