Problem 3-4 (Algorithmic) Inventories (LO 3.2) Kevin owns a retail store, and during the current year he purchased $874,600 worth of inventory. Kevin's beginning inventory was $87,460 and his ending inventory is $104,952. During the year, Kevin withdrew $17,492 in inventory for his personal use. Assume that he uses the cost method to value the inventory and there was no change in determining quantities, costs, or valuations between opening and closing inventory Use Part III of Schedule C below to calculate Kevin's cost of goods sold for the year. Eamounts as positive numbers Part III Cost of Goods Sold (see instructions) 33 Method(s) used to value closing inventory: Cost 34 Was there any change in determining quantities, costs, or valuations between opening and closing inventory? 35 36 37 38 39 40 41 42 35 Inventory at beginning of year. If different from last year's closing inventory, attach explanation. . 36 Purchases less cost of items withdrawn for personal use. . . . . . . . . . .. . . . . . . . . . .. . . . . . . . . . 37 Cost of labor. Do not include any amounts paid to yourself. . . . . . . . .. . . . . . . . . . .. . . . . . . . . . 42 Cost of goods sold. Subtract line 41 from line 40. Enter the result here and on line 4. . . . . . . . Feedback Check My Work The cost of inventory a taxpayer owns has a significant impact on the taxable income of the taxpayer. The deduction for the cost of goods sold of a retail business is a direct function of the amount of the beginning and ending inventories