A company has a beginning inventory of \( \$ 20,000 \) and purchases during the year of \( \$ 110,000 \). The beginning inventory consisted of 2,000 units and 6,000 units were purchased during the year. The company has 3,000 units left at year - end. Under average - cost, what is Cost of Goods Sold? (Round any intermediary calculations to two decimal places and your final answer to the nearest dollar.)

To calculate the Cost of Goods Sold (COGS) under the average-cost method, we first need to determine the total cost of the goods available for sale and then the average cost per unit. 1. **Calculate total costs:** Beginning Inventory Cost: $20,000 Purchases Cost: $110,000 Total Cost: $20,000 + $110,000 = $130,000 2. **Calculate total units available for sale:** Beginning Inventory Units: 2,000 Purchased Units: 6,000 Total Units Available: 2,000 + 6,000 = 8,000 units 3. **Calculate average cost per unit:** Average Cost per Unit = Total Cost / Total Units Available Average Cost per Unit = $130,000 / 8,000 = $16.25 per unit 4. **Calculate units sold:** Units Sold = Total Units Available - Ending Inventory Units Units Sold = 8,000 - 3,000 = 5,000 units 5. **Calculate Cost of Goods Sold:** COGS = Units Sold * Average Cost per Unit COGS = 5,000 units * $16.25 = $81,250 Thus, the Cost of Goods Sold (COGS) for the year is **$81,250**.