Period-end cost of goods sold under the periodic system

Transaction

A store’s inventory was $24,000.00 at the start of the year, and its purchases for the year, recorded in Purchases, were $96,000.00. At year end the physical count values the goods on hand at $20,500.00. Record the year-end entry for cost of goods sold.

Assumptions: Periodic inventory: purchases are recorded in Purchases and Inventory is updated only at year end. Cost of goods sold is recorded with an adjusting entry, not through Income Summary. There is no freight-in and there are no purchase returns or discounts.