James Harry is a trader who sells all of his goods at 25 per cent above cost. His records give the following information at 31 December 2021:

Inventories at 1 January 2021           9,872

Inventories at 31 December 2021   12,620

Sales for the year                               60,000

You are required to:

(a) ascertain the cost of goods sold

(b) calculate the cost of purchases during the year

(c) calculate the profit earned by Harry.

Answer rating: 100% (QA)

To ascertain the cost of goods sold COGS we need to calculate the change in inventory from t... View the full answer