Borland Company had a beginning balance in its accounts paya

Borland Company had a beginning balance in its accounts payable of S45,000. At the end of the period, this balance had increased to S68,000. The beginning balance of Borland\'s inventory account was $24,000 and the ending balance was S16,000. During the period, Borland purchased S520,000 (net) of inventory. It returned $4,800 (net) of this inventory to vendors due to poor quality. Assuming that this is the only activity affecting these two accounts, what is Borland\'s cost of goods sold for the period and how much cash did Borland pay for inventory during the period?

Solution

Calculate cost of goods cost

Cost of goods sold = Beginning inventory+Purchase-Ending inventory

= 24000+515200-16000

Cost of goods sold = 523200

Amount paid for inventory during period = 45000+523200-68000 = $500200