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    brunette375's Avatar
    brunette375 Posts: 1, Reputation: 1
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    #1

    Feb 24, 2008, 11:40 AM
    Cost of Goods Sold (Multi-step Income Statement)
    Hello, I'm new to this site. I have a homework question that I am confused about. I was wondering if someone could possibly help me with it.

    The question asks to find the beginning and ending balance of the cost of goods sold on the multi-step income statement for each fiscal year and I'm not sure how I would find that.
    morgaine300's Avatar
    morgaine300 Posts: 6,561, Reputation: 276
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    Feb 24, 2008, 11:10 PM
    That's a really weird question. There's no such thing as a beginning balance for that accounts. It's an expense account, and expense accounts "close out" to zero at the end of each year, and therefore start over again at zero. So I don't see how you could possibly find it.

    And anything found on an income statement should be an ending balance. If they literally mean "find" it -- it's under the net sales. If they mean to calculate it... um, are you doing perpetual method?
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