Gross Profit Method A flood completely destroyed all the inventory of Bayside Waterworks Company on July 1, 20--. Fortunately, the accounting records were not destroyed in the flood. The following information is provided by Bayside Waterworks for the time period January 1 through July 1, 20--: Beginning inventory, January 1, 20--   $60,000 Net purchases, January 1 through July 1   380,000 Net sales, January 1 through July 1   650,000 Normal gross profit as a percentage of sales   45%   Required: Estimate the amount of merchandise inventory destroyed in the flood on July 1 using the gross profit method. $fill in the blank 1

Q: Windsor Corporation's April 30 inventory was destroyed by fire. January 1 inventory was $154,200,…

A: Inventory, based on its intended use and where it is in the manufacturing or distribution process.…

Q: On February 26, a hurricane destroyed the entire inventory stored in a warehouse owned by the…

A: Given,  Gp ratio = 40% = 100 * Gross profit / Net sales Purchase = 420000 Net sales = 620000…

Q: On April 15, a bad day in many ways, a fire destroyed the entire inventory of a local retail store,…

A: The difference between the sales and the cost of goods sold is called gross profit. Gross profit…

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A: Inventories are the current assets held for sale or manufacture in the ordinary course of business.…

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A: Inventory destroyed = Beginning inventory + Net purchases - Cost of goods sold Cost of goods sold =…

Q: iross Profit Method: Estimation of Flood Loss In November 21, 2016, a flood at Hodge Company's…

A: Solution:-1 Preparation of a schedule to calculate the estimated loss on the inventory in the flood,…

Q: A fire completely destroyed all the inventory of Glisan Lumber Yard on August 5, 20--. Fortunately,…

A: The gross profit is calculated as the difference between sales and cost of goods sold. The estimated…

Q: Grouper Company lost most of its inventory in a fire in December just before the year-end physical…

A: Lets understand the basics. When inventory gets damaged due to fire then loss due to fire needs to…

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A: Lets understand the basics.Inventory is generally calculated at a regular interval. It can be…

Q: A fire destroyed a warehouse of the Goren Group, Incorporated, on May 4, 2024. Accounting records on…

A: The ending inventory can be calculated by deducting the cost of goods sold from the cost of goods…

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A: Effective inventory management is important to the success of any business that sells physical…

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A: Gross Profit is profit earned on selling the goods, which is calculated by deducting Cost of goods…

Q: A substantial portion of inventory owned by Prentiss Sporting Goods was recently destroyed when the…

A: Hi student Since there are multiple subparts, we will answer only first three subparts.

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A: The inventory can be valued using various methods as LIFO, FIFO and weighted average method. The…

Q: Gross Profit Method The merchandise inventory was destroyed by fire on December 13. The following…

A: Gross profit method is mainly used in estimating the closing inventory by applying gross profit…

Q: The inventory of Waterway Company was destroyed by fire on March 1. From an examination of the…

A: Gross profit is the difference between net sales and cost of goods sold. Net sales are calculated as…

Q: Bob "Big Bobby" Weinstein Ltd. experienced complete melt-down of all inventory due to a very…

A: Gross profit can be calculated as a percentage on net sales. Otherwise it can be calculated as the…

Q: A fire completely destroyed the entire inventory of Printing Delight Co. on March 15, 20--.…

A: Part (1)   Calculation of the cost of goods sold for the time period Net Sales - Gross Profit =…

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A: >Ending inventory is the amount of inventory left on hand at the end of period. >Due to…

Q: Estimating Inventory Using Gross Profit Method Wood's warehouse burned down on April 1 of Year 4.…

A: To estimate the cost of the inventory destroyed in the fire using the average gross profit…

Q: A flood on 30th Nov destroyed some of a company’s inventory and its inventory records. The following…

A: Lets understand the basics. When due to any reason inventory gets destroyed then it needs to record…

Q: Tamarisk Company lost most of its inventory in a fire in December just before the year-end physical…

A: Inventory loss due to fire refers to the reduction in the recorded value of merchandise destroyed by…

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A: The formual for ending inventory is as follows:

Q: Question: On November 21, 2013, a fire at Hodge Company's warehouse caused severe damage to its…

A: Explanation of Gross Profit:Gross profit is a key financial metric that represents the difference…

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A: Ending Inventory = Beginning Inventory + Purchases - Cost of goods sold   Cost of goods sold =…

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A: Inventory management effectively balances the requirement to make items available to consumers while…

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A: The ending inventory is calculated as difference between cost of goods available for sale and cost…

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A: Cost of goods sold = Net sales - Gross profit where, Gross profit = Net sales x Gross profit rate

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A: Estimated ending inventory is the amount of inventory that an entity have, at the end of the period.…

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A: Gross profit = sales * gross profit percentage

Q: Current Attempt in Progress Bonita Company lost most of its inventory in a fire in December just…

A: Amount of loss = Ending inventory - Undamaged inventory - Net realizable value of damaged…

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A: The gross profit method is used to determine the value of ending inventory when there is a lack of…

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A: A schedule for the cost of goods is prepared to determine the cost of goods available for sale, the…

Inventory Valuation

Before discussing the topic inventory valuation let’s discuss the meaning of inventory. In accounting, inventory is also known as stock. Inventory means all the finished goods, materials, merchandise that a business holds for the purpose of selling it in the market with the motive of earning profit.