Which of the Following Formulas Represents Cost of Goods Sold

question 36

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:

Gains from Specialization

The increase in overall production and efficiency that occurs when individuals or entities focus on specific tasks or functions they perform best.

Comparative Advantage

The ability of an individual, company, or country to produce a good or service at a lower opportunity cost than competitors.

World Economic Resources

It refers to all natural, human, and capital resources that are available globally which support economic production and development.

Net Exporter

A country that exports more goods and services than it imports, leading to a positive trade balance.