How do I calculate purchases when I have net A/R, Inventory, A/P, sales, cost of sales and gross margin?

Question

Net A/R for 20X1 is $837 and for 20X2 is $1,335. Inventory for 20X1 is $1,025 and $1,327 for 20X2. Accounts payable for 20X1 is $164, for 20X2 is $380. Sales for 20X1 is $3,780 and for 20X2 is $5,638. Cost of sales for 20X1 is $1812 and for 20X2 is $2,691. The gross margin for 20X1 is $1968 and for 20X2 is $2,947.

Answer 1

In this case the inventory has gone up from last year also you have sold 2691 so total purchases can be calculated in the following format:

Increase in Inventory = 1327-1025 = 302

Cost of sales                                   =  2691

Total purchases = 2691+302=2993

Or - you may have learnt the following:

beginning inventory + purchases - ending inventory = cost of sales

so purchses would be working around the equation you get

purchases = cost of sales +ending inventory - beginning inventory

No matter which way you use, you get the same answer of 2993.

Answer 2

purchases = 2993

end inv + cos - beg inv = purchases

1327 + 2691 - 1025 = 2993