If net sales are $300,000, cost of goods available for sale is $280,000, and gross profit percentage is 35%. What is the amount of ending inventory?

Answer 1

Ending inventory is $85,000.

Explanation:

Gross Profit = 35% x $300,000 = $105,000

Cost of Goods sold will be

COGS = Net sales - Gross profit = $300,000 - $105,000 = $195,000

So ending inventory will be

Ending inventory = Cost of goods available for sale - Cost of goods sold = $280,000 - $195,000

Ending Inventory = $85,000