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cblinehan
New Member

Starting inventory for 2016 was zero. Inventory at end of year was $9469. I also listed the cost of Purchases as 9,469. Inventory/Cost of goods sold still shows zero on roll-up page. Why?

 
1 Reply
MinhT
Expert Alumni

Starting inventory for 2016 was zero. Inventory at end of year was $9469. I also listed the cost of Purchases as 9,469. Inventory/Cost of goods sold still shows zero on roll-up page. Why?

The formula for Cost of Goods sold is Starting Inventory plus Purchases minus Ending inventory.

From your entries, if Starting inventory=0, Purchases=$9,469 and Ending inventory=$9,469, then Cost of Goods sold=0.

It means that if you bought goods for resale for $9,469 and the whole $9,469 remained in inventory at year, then you have not sold anything, Cost of goods sold=0.

To correct this, Purchases should reflect the value at cost price of the goods for resale you have bought in during the year and Ending inventory is the value at cost of those goods which remain in inventory at year end. The difference between these two amounts is Cost of Goods sold.

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