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Century 21 Accounting Multicolumn Journal

Century 21 Accounting Multicolumn Journal

11th Edition

ISBN:9781337679503

Author:Gilbertson

Publisher:Gilbertson

Chapter20: Accounting For Inventory

Section: Chapter Questions

Problem 1CP

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Gross profit percentage on sales 30%What amount of inventory was lost in the fire?

A fire destroyed most of the inventory in Mick's warehouse on
September 1. After the fire, Mick's accounting records showed the
following:
Inventory, January 1
$ 55,000
Purchases, January 1 through September 1
$ 3,10,000
Sales, January 1 through September 1
$ 3,70,000
Inventory not damaged by fire
$ 45,000
30%
Gross profit percentage on sales
What amount of inventory was lost in the fire?
a. $259,000
b. $61,000
c. $106,000
d. $55,000

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