Given: Opening stock50,000Purchases200,000Sales350,000Closing stock80,000 Opening stock 50 , 000 Purchases 200 , 000 Sales 350 , 000 Closing stock 80 , 000 ...

Answer Details

To calculate the cost of goods sold (COGS), we need to subtract the closing stock from the sum of the opening stock and purchases. The COGS is the cost of the products that were sold during the accounting period. So, let's calculate the sum of the opening stock and purchases: Opening stock + Purchases = ₦50,000 + ₦200,000 = ₦250,000 Now, let's subtract the closing stock from this sum: COGS = (Opening stock + Purchases) - Closing stock = ₦250,000 - ₦80,000 = ₦170,000 Therefore, the cost of goods sold is ₦170,000. Option C is the correct answer. The cost of goods sold is an important figure in accounting as it is used to calculate gross profit, which is the difference between sales revenue and COGS. Gross profit is a measure of how efficiently a company is using its resources to produce and sell its products.