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Century 21 Accounting Multicolumn Journal

Century 21 Accounting Multicolumn Journal

11th Edition

ISBN:9781337679503

Author:Gilbertson

Publisher:Gilbertson

Chapter20: Accounting For Inventory

Section: Chapter Questions

Problem 1CP

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Need answer the accounting question

Harrison Manufacturing experienced a major fire in its warehouse
on October 15, destroying much of the inventory. The accounting
records indicate the following:
Account
Inventory, January 1
Amount ($)
70,000
Purchases, January 1 through October 15 380,000
Sales, January 1 through October 15
Inventory remaining after the fire
Gross profit percentage on sales
460,000
55,000
25%
What is the amount of inventory lost in the fire?
a) $147,500
b) $72,500
c) $50,000
d) $110,000

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