LAVARN Company sells milled rice in Isabela Province. On September 15, a flood destroyed the company's warehouse, along with all its inventory on hand. No inventory was salvaged. The inventory on hand as of August 31 had a selling price of P7,500,000. Purchases made from September 1 until the flood totaled P2,000,000 and sales of P9,500,000 were made on the same period. The gross profit on sales is 30%. What is the estimated ending inventory? 2,850,000 O 2,192,308 850,000 600,000 O Answer not given

LAVARN Company sells milled rice in Isabela Province. On September 15, a flood destroyed the company's warehouse, along with all its inventory on hand. No inventory was salvaged. The inventory on hand as of August 31 had a selling price of P7,500,000. Purchases made from September 1 until the flood totaled P2,000,000 and sales of P9,500,000 were made on the same period. The gross profit on sales is 30%. What is the estimated ending inventory? 2,850,000 O 2,192,308 850,000 600,000 O Answer not given

Name: LAVARN Company sells milled rice in Isabela Province. On September 15
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Description: LAVARN Company sells milled rice in Isabela Province. On September 15, aflood destroyed the company's warehouse, along with all its inventory onhand. No inventory was salvaged. The inventory on hand as of August 31had a selling price of P7,500,000.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

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.

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Question

LAVARN Company sells milled rice in Isabela Province. On September 15, a
flood destroyed the company's warehouse, along with all its inventory on
hand. No inventory was salvaged. The inventory on hand as of August 31
had a selling price of P7,500,000. Purchases made from September 1 until
the flood totaled P2,000,000 and sales of P9,500,000 were made on the
same period. The gross profit on sales is 30%. What is the estimated
ending inventory?
O 2,850,000
O 2,192,308
850,000
600,000
O Answer not given

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