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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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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 $310,000
Sales, January 1 through September 1
Inventory not damaged by fire
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
$370,000
$45,000
30%

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A fire on 30 September 20X2 destroyed some of a company's inventory and its inventory records. The following information is available: $ Inventory 1 September 20X2 318,000 Sales for September 20X2 612,000 Purchases for September 20X2 412,000 Inventory in good condition at 30 September 20X2 214,000 Standard gross profit percentage on sales is 25% Based on this information, what is the value of the inventory lost? A $96,000 B $271,000 C $26,400 D $57,000
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