Gross Profit Method of Estimating Inventory E9.14: Astaire ASA uses the gross profit method to estimate inventory for monthly reporting purposes. Presented below is information for the month of May. Inventory, May 1 Purchases (gross) Freight-in € 160,000 640,000 30,000 Sales Sales returns Purchases discounts € 1,000,000 70,000 12,000 Instructions: (a) Compute the estimated inventory at May 31, assuming that the gross profit is 25% of sales.
Gross Profit Method of Estimating Inventory E9.14: Astaire ASA uses the gross profit method to estimate inventory for monthly reporting purposes. Presented below is information for the month of May. Inventory, May 1 Purchases (gross) Freight-in € 160,000 640,000 30,000 Sales Sales returns Purchases discounts € 1,000,000 70,000 12,000 Instructions: (a) Compute the estimated inventory at May 31, assuming that the gross profit is 25% of sales.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Topic Video
Question
Please do not give solution in image format thanku
Transcribed Image Text:Gross Profit Method of Estimating Inventory
E9.14: Astaire ASA uses the gross profit method to estimate inventory
for monthly reporting purposes. Presented below is information for the
month of May.
Inventory, May 1 € 160,000
Purchases (gross) 640,000
Freight-in
30,000
Instructions:
(a) Compute the estimated inventory at May 31, assuming that the
gross profit is 25% of sales.
Sales
€ 1,000,000
Sales returns
70,000
Purchases discounts 12,000
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education