Cost of goods sold is equal to: The cost of inventory on hand at the end of a period plus net purchases minus the cost of inventory on hand at the beg The cost of inventory on hand at the beginning of a period minus the cost of inventory on hand at the end of a period pl The cost of inventory on hand at the beginning of a period minus net purchases plus the cost of inventory on hand at the The cost of inventory on hand at the beginning of a period plus net sales minus the cost of inventory on hand at the end 10 If goods shipped FoB destination are in transit at the end of the year, they should be included in the inventory balance of the: Bank Buyer Common carrier seller

Let's break down the two parts of your question step by step. ### Part 1: Cost of Goods Sold (COGS) The formula for Cost of Goods Sold (COGS) can be expressed as: \[ \text{COGS} = \text{Beginning Inventory} + \text{Net Purchases} - \text{Ending Inventory} \] From the options provided, the correct statement that matches this formula is: - **The cost of inventory on hand at the beginning of a period plus net purchases minus the cost of inventory on hand at the end.** ### Part 2: Goods Shipped FoB Destination FoB (Free on Board) destination means that the seller retains ownership of the goods until they reach the buyer's location. Therefore, if goods are in transit at the end of the year and are shipped FoB destination, they should still be included in the inventory balance of the: - **Seller** ### Summary of Answers: 1. The correct formula for COGS is: **The cost of inventory on hand at the beginning of a period plus net purchases minus the cost of inventory on hand at the end.** 2. Goods shipped FoB destination in transit at the end of the year should be included in the inventory balance of the: **Seller.**