Which of the Following Formulas Represents Cost of Goods Sold

question 158

Multiple Choice

Which of the following formulas represents cost of goods sold for a merchandising business?

• A) Beginning inventory - ending inventory = cost of goods sold
• B) Purchases and freight in - ending inventory = cost of goods sold
• C) Ending inventory + purchases and freight in - beginning inventory = cost of goods sold
• D) Beginning inventory + purchases and freight in - ending inventory = cost of goods sold

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Definitions:

Resource Prices

The cost of inputs used in the production of goods and services, such as labor, raw materials, and capital.

Market System

An economic system relying on market forces to allocate resources and to determine and regulate prices for goods and services.

What Will Be Produced

A fundamental economic question that addresses the kinds of goods and services to be made available in an economy, determined by factors such as resources, technology, and consumer preferences.

Consumer Sovereignty

The idea that what consumers want influences the goods and services produced in an economy.