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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Subject : Accounting
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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