Bardell, Inc. prepared its statement of cash flows for the year. The following information is taken from that statement: Net cas
h provided by operating activities $ 29,000 Net cash provided by investing activities 8,400 Cash balance, beginning of year 11,600 Cash balance, end of year 18,200 What is the amount of net cash provided by (used in) financing activities
The cost of goods sold for the company is $2,005,830.
This can be calculated from the available information using the following steps:
<u>Step 1: Calculation of Current Assets</u>
To do this, we use the current ratio formula as follows:
Current ratio = Current Assets / Current Liabilities
Substituting the values in the question into the equation above and solve for Current Assets, we have:
1.5 = Current Assets / $510,000
Current Assets = $510,000 * 1.5 = $765,000
<u>Step 2: Calculation of Inventory</u>
To do this, we use the Quick Ratio formula as follows:
Quick ratio = (Current Assets - Inventory) / Current Liabilities
Substituting the values in the question and from Step 1 into the equation above and solve for Inventory, we have:
0.93 = ($765,000 - Inventory) / $510,000
0.93 * $510,000 = $765,000 - Inventory
$474,300 = $765,000 - Inventory
$474,300 + Inventory = $765,000
Inventory = $765,000 - 474,300 = $290,700
Note that this inventory of $290,700 is the ending inventory.
<u>Step 3: Calculation of Cost of Goods Sold</u>
To do this, we use the Inventory Turnover formula as follows:
Inventory turnover = Cost of goods sold / Average Inventory
Note that average Average Inventory is the addition of the beginning and closing inventory divided by 2. But since the beginning inventory is not available, the practice is to use the ending inventory in place of the average inventory. This is what we do here below.
Substituting the values in the question and from Step 2 into the equation above and solve for Cost of goods sold, we have:
6.9 = Cost of goods sold / $290,700
Cost of goods sold = 6.9 * $290,7000 = $2,005,830
Therefore, the cost of goods sold for the company is $2,005,830.
The totals of Trial balance have a difference of $8,000. The credit balance totals of Trial balance is higher than the debit totals because the original entry of debit is mission and there is an wrong posing on the credit side which reduce the debit balance by $4,000 and Increase the credit balance by $4,000 at the same time. Net effect will be $8,000 in totals of trial balance.