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Assume that we are auditing the records of Forde Corporation. A physical inventory has been taken by the company under our observation. The records of the company show the following account data. The gross profit last year was 25% of net sales; we anticipate that it will be 25% for the current year under audit. Sales, gross $1,134,000

Assume that we are auditing the records of Forde Corporation. A physical inventory has been taken by the company under our observation. The records of the company show the following account data. The gross profit last year was 25% of net sales; we anticipate that it will be 25% for the current year under audit. Sales, gross $1,134,000

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Assume that we are auditing the records of Forde Corporation. A physical inventory has been taken by the company under our observation. The records of the company show the following account data. The gross profit last year was 25% of net sales; we anticipate that it will be 25% for the current year under audit. Sales, gross $1,134,000 Sales returns (returned to inventory) 18,000 Purchases, gross Beginning inventory Freight-in Purchase returns and allowances 558,000 360,000 25,200 7,200 Required Estimate the cost of ending inventory using the gross profit method. • Note: Do not use negative signs with your answers. Cost of goods available for sale Answer Cost of goods sold, estimated Answer Ending Inventory, estimated Answer
Transcribed Image Text:Assume that we are auditing the records of Forde Corporation. A physical inventory has been taken by the company under our observation. The records of the company show the following account data. The gross profit last year was 25% of net sales; we anticipate that it will be 25% for the current year under audit. Sales, gross $1,134,000 Sales returns (returned to inventory) 18,000 Purchases, gross Beginning inventory Freight-in Purchase returns and allowances 558,000 360,000 25,200 7,200 Required Estimate the cost of ending inventory using the gross profit method. • Note: Do not use negative signs with your answers. Cost of goods available for sale Answer Cost of goods sold, estimated Answer Ending Inventory, estimated Answer
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