Question

Cost of Goods Sold Allyson Ashley makes jet skis. During the year, Allyson manufactured 94,000 jet skis. Finished goods inventory had the following units:

January: 16,800
December 317,200
Required:
1. How many jet skis did Allyson sell during the year?
2. If each jet ski had a product cost of $2,200, what was the cost of goods sold last year?

Answer 1

Answer:

1. 103,600 jet skis

2. $227,920,000

Explanation:

1. Allyson Ashley's total units sold is computed as follows;

Beginning balance            16,800

Add: Units manufactured 94,000

Total available units         110,800

Less: Ending balance          7,200

TOTAL UNITS SOLD        103,600

*It is simply adding Beginning balance with the units manufactured during the period to get the total units available for sale, then deduct the Ending inventory from the total available units for sale to get the total units sold.

2. Cost of Goods Sold is computed by multiplying total units sod by the unit product cost.

103,600 x $2,200 = $227,920,000