Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA MA – FIA FMA › cost of goods
- This topic has 6 replies, 2 voices, and was last updated 8 years ago by
John Moffat.
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- June 15, 2016 at 11:04 am #323021
Sales = op. inv + production – closing inventory ..
Cost of goods sold = ope. inv + purchases – closing inventory .
is this two equation same ?
To convert sales into cost of goods sold , can i use first formulae ?
June 15, 2016 at 5:14 pm #323077Sales only equals opening inventory + production – closing inventory in terms of numbers of units.
It certainly doesn’t equal that in terms of $’s!How can the two equations possibly be the same when goods are sold at a higher amount than they cost? !!
June 16, 2016 at 3:05 am #323126Sorry yeah. I now realise it. So is there any way to convert sales to cost of goods sold ?
June 16, 2016 at 10:17 am #323146i mean if there is a mark up of 50% how to convert sales to cost of goods sold ?
June 16, 2016 at 10:31 am #323147i understand that to find cogs = selling price / 1.5 is right.
i saw somewhere an application 50 / 150 or 150/50 to find it.. i am confused now
June 16, 2016 at 10:35 am #323148I understand it now. I should have subtracted it to arrive at COGS. Sorry to post this without thinking with patience. Thanks
June 16, 2016 at 5:22 pm #323186I am glad that you now understand it 🙂
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