[startupcfo]

The following information is available for Cooke Company for year 2:

Net sales $1,800,000
Freight-in 45,000
Purchase discounts 25,000
Ending inventory 120,000
The gross margin is 40% of net sales. What is the cost of goods available for sale?

We can deduce COGS and we are given ending inventory.

Why does the book tell me not to count in the freight and purchase discounts? Doesn’t that contribute to the cost of making my inventory?

BEC - 87 | 02/28
REG - 70 | 06/10, REMATCH | 08/30
AUD - XX | 09/10
FAR - XX | 12/10

[Anonymous]

Is GAFS $1,200,000?

[Missy]

Ignore freight in and purchase discounts because they're already part of your ending inventory.

Licensed Massachusetts Non Reporting CPA since 2012
Finance/Admin/HR Manager

[Author]

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