Bloom corp. uses the periodic inventory system. determine thornton's cost of goods sold if its beginning inventory was $124,000, purchases for the year were $265,700, and the ending inventory was $73,220.

To solve for the cost of goods sold, it is computed by adding the beginning inventory to the cost of goods purchased or manufactured, adding those two will give you the total cost of goods available for sale then deduct the ending inventory, you’ll get the cost of goods sold.

Solution:

Beginning Inventory - $124,000

Add: Purchases - 265,700

Total Goods Available for Sale is = $389,700

Computation for Cost of Goods Sold:

Total Goods Available for Sale - $389,700

Less: Ending Inventory - 73,220

Cost of Goods Sold = $316,480