An auditor for the Internal Revenue Service is trying to reconstruct some partially destroyed records of two taxpayers.

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Requirement

For each of the cases, find the unknowns designated by the letters A and B for Case 1 and C and D for Case 2.

Case 1: Find the unknowns designated by the letters A and B.

First, solve for A. Cost of goods sold.

Gross margin

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Data Table

	Case 1	Case 2
	(in thousands)
Accounts receivable, December 31	$12,000	$3,250
Cost of goods sold	A	33,000
Accounts payable, January 1	4,200	1,550
Accounts payable, December 31	2,900	1,860
Finished-goods inventory, December 31	B	5,500
Gross margin	15,200	C
Work-in-process inventory, January 1	3,400	1,100
Work-in-process inventory, December 31	0	4,300
Finished-goods inventory, January 1	7,000	4,000
Direct materials used	11,000	17,000
Direct manufacturing labor	4,300	7,600
Manufacturing overhead costs	10,600	D
Purchases of direct materials	13,600	14,500
Revenues	45,000	51,300
Accounts receivable, January 1	3,500	1,600