The following information is available for October for Sheridan Company. (Round answers to 0 decimal places, e.g. 5,275.)Beginning Inventory$330000Net purchases1060000Net sales2120000Percentage markup on66.67%costA fire destroyed Sheridan's October 31 inventory, leaving undamaged inventory with a cost of $20500. Using the gross profit method,the estimated ending inventory destroyed by fire isO $730000.O $97500.O$565333.$544833.

Calculation of Cost of Goods Sold= [Net Sales / 166.67] x 100= [2,120,000 / 166.67] x 100=…

Answered: A fire destroyed Sheridan's October 31…

A fire destroyed Sheridan's October 31 inventory, leaving undamaged inventory with a cost of $20500. Using the gross profit method, the estimated ending inventory destroyed by fire is

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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What did i do wrong in my calculations? On November 21, 2021, a fire at Hodge Company’s warehouse caused severe damage to its entire inventory of Product Tex. Hodge estimates that all usable damaged goods can be sold for $18,000. The following information was available from the records of Hodge’s periodic inventory system: Inventory, November 1 $ 130,000 Net purchases from November 1, to the date of the fire 146,000 Net sales from November 1, to the date of the fire 226,000 Based on recent history, Hodge’s gross profit ratio on Product Tex is 30% of net sales. Required:Calculate the estimated loss on the inventory from the fire, using the gross profit method. $134,200
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David Patel was at home when he received a call from the fire department telling him his store had burned. His business was a total loss. The insurance company asked him to prove his inventory loss. For the year, until the date of the fire, Patel's company had sales of $450,000 and purchases of $280,000. Freight-in amounted to $13,700, and beginning inventory was $45,000. Patel always priced his goods to achieve a gross margin of 40 percent. Compute patel's estimated inventory loss.
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