Grouper Company lost most of its inventory in a fire in December just before the year-end physical inventory was taken. The corporation's books disclosed the following. Beginning inventory Purchases for the year Purchase returns $173,200 424,200 28,000 Sales revenue Sales returns Rate of gross profit on net sales $672,900 24,600 30 % Merchandise with a selling price of $21,000 remained undamaged after the fire. Damaged merchandise with an original selling price of $16,100 had a net realizable value of $5,700. Compute the amount of the loss as a result of the fire, assuming that the corporation had no insurance coverage.
Grouper Company lost most of its inventory in a fire in December just before the year-end physical inventory was taken. The corporation's books disclosed the following. Beginning inventory Purchases for the year Purchase returns $173,200 424,200 28,000 Sales revenue Sales returns Rate of gross profit on net sales $672,900 24,600 30 % Merchandise with a selling price of $21,000 remained undamaged after the fire. Damaged merchandise with an original selling price of $16,100 had a net realizable value of $5,700. Compute the amount of the loss as a result of the fire, assuming that the corporation had no insurance coverage.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Grouper Company lost most of its inventory in a fire in December just before the year-end physical inventory was taken. The
corporation's books disclosed the following.
Beginning inventory
Purchases for the year
Purchase returns
Amount of the loss
$173,200
$
424,200
28,000
Sales revenue
Sales returns
Rate of gross profit on net sales
$672,900
24,600
Merchandise with a selling price of $21,000 remained undamaged after the fire. Damaged merchandise with an original selling price of
$16,100 had a net realizable value of $5,700.
Compute the amount of the loss as a result of the fire, assuming that the corporation had no insurance coverage.
30 %
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