Kids Costumes estimates its inventory by the gross profit method. The gross profit has averaged 39% of net sales. The company's inventory records reveal the following data: Inventory, July 1 $268,000 Transactions during July: Purchases 7,661,000 Purchase discounts 171,000 Purchase returns 32,000 Sales 8,788,000 35,000 Sales returns 1. Estimate the July 31 inventory using the gross profit method. 2. Prepare the July income statement through gross profit for Kids Costumes.
Kids Costumes estimates its inventory by the gross profit method. The gross profit has averaged 39% of net sales. The company's inventory records reveal the following data: Inventory, July 1 $268,000 Transactions during July: Purchases 7,661,000 Purchase discounts 171,000 Purchase returns 32,000 Sales 8,788,000 35,000 Sales returns 1. Estimate the July 31 inventory using the gross profit method. 2. Prepare the July income statement through gross profit for Kids Costumes.
Chapter1: Financial Statements And Business Decisions
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Transcribed Image Text:Kids Costumes estimates its inventory by the gross profit method.
The gross profit has averaged 39% of net sales. The company's
inventory records reveal the following data:
Inventory, July 1
$268,000
Transactions during July:
Purchases
7,661,000
Purchase discounts
171,000
Purchase returns
32,000
Sales
8,788,000
35,000
Sales returns
1. Estimate the July 31 inventory using the gross profit method.
2. Prepare the July income statement through gross profit for Kids
Costumes.
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