Answer:
$30,000
Explanation:
The computation of the estimated cost of ending inventory is shown below:
As we know that
Cost of goods sold = Beginning inventory + Cost of goods purchased - ending inventory
where,
Cost of goods sold is
= Net Sales - gross profit
= $200,000 - $200,000 × 40%
= $200,000 - $80,000
= $120,000
Beginning inventory is $60,000
Cost of goods purchased is $90,000
So, the ending inventory is
$120,000 = $60,000 + $90,000 - ending inventory
Hence, the ending inventory is $30,000
The cost of goods sold refers to the cost which is directly related to the goods sold or created i.e direct material, direct labor, etc
