Coach company budgeted purchases of Php 100,000

Finance Dec 09, 2020

Coach company budgeted purchases of Php 100,000. Cost of sales was Php 120,000 and the desired ending inventory was Php 42,000. What is the beginning inventory?

Expert Solution

Formula for calculating the beginning inventory is = Cost of sales - purchases + ending inventory

The cost of sales are the product produced and sold in that particular period , purchases are the

Purchases are refer to inventory purchases on particular period

Ending inventory is closing inventory of the period

Data given:

Purchases: PHP100,000

Cost of sales: PHP 120,000

Ending Inventory: PHP 42,000

Opening or beginning inventory=120,000-100,000+42,000

beginning inventory=PHP 62,000

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