UK Cost of Sales question

[Alfies]

Hello all,

Is it possible when you are not provided with Cost of Sales to use Credit Purchases with opening and closing inventory? I need to work out an operating cycle, but no cost of sales are provided for some of the calculations. Only the inventories and credit purchases and credit sales.

Thank you, Alfie

 

[Fidget]

Yes: Opening Inventory + Purchases - closing inventory = Cost of Sales. But that is as basic as it can be though.

 

[John Baker]

Alfies, what does your business do specifically with the physical inventory?
1) you acquire said inventory on credit, it's directly received by you and you stock it, then you sell and ship it.
=and/or=
2) inventory is ordered and sold by you on credit, but shipped directly to a customer without being in your possession.
Somewhat like a catalog company/sales broker.
=and/or=
3) your customer orders the inventory from a sales firm (catalog), they (sales firm/ catalog company) instruct you on the product, you then ship it, you receive your sales revenue from the sales firm/catalog company.