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?     A. 2,850,000       B. 2,192,308       C. 850,000       D. 600,000       E. Answer not given

Q: On February 26, a hurricane destroyed the entire inventory stored in a warehouse owned by the…

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Q: On April 15, a bad day in many ways, a fire destroyed the entire inventory of a local retail store,…

A: The difference between the sales and the cost of goods sold is called gross profit. Gross profit…

Q: On February 26, a hurricane destroyed the entire inventory stored in a warehouse owned by the…

A: Net purchases and beginning inventories are included in the cost of commodities that are offered for…

Q: On January 1 a store had inventory of P55,000. January purchases were P46,000 and January sales were…

A: Amount of Fire Loss = Ending Inventory - Undamaged Goods Ending Inventory = Beginning Inventory +…

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A: Sales are made at 33 1/3% above cost and totaled $111,000. Let the Cost of Goods sold be $x.…

Q: On February 26, a hurricane destroyed the entire inventory stored in a warehouse owned by the…

A: Gross Profit Method:   Under this method, the beginning inventory is added to the net purchases…

Q: On March 15, a fire destroyed MyCompany's entire retail inventory. The inventory on hand as of…

A: Cost of goods sold = Beginning inventory + Purchases + Freight in - Closing inventory

Q: On March 1, AYE Merchandising had an inventory of P560,000 in its retail store. Purchases made in…

A: The merchandise loss can be incurred due to fire or theft, etc. This loss can be estimated with the…

Q: Marigold Inc.’s April 30 inventory was destroyed by the explosion of an underground oil tank.…

A: Gross Profit is profit earned on selling the goods, which is calculated by deducting Cost of goods…

Q: The home office consistently bills its branch for shipments at 120% of cost. On September 21, 2021,…

A: Whenever head office sells goods to its branch it will add certain markup on cost price. Such markup…

Q: Sunland Legler requires an estimate of the cost of goods lost by fire on March 9. Merchandise on…

A: Solution: Introduction: Inventory means goods are available for sale and raw materials used in the…

Q: n March 1, AYE Merchandising had an inventory of P560,000 in its retail store. Purchases made in…

A: solution given Inventory March 1 560000 Purchases during March 480000 Sales during…

Q: On February 26, a hurricane destroyed the entire inventory stored in a warehouse owned by the…

A: The gross profit approach is a method of determining the volume of finishing inventory in a given…

Q: On 1 September 20x6, a business had inventory of $380,000. During the month, sales totalled $650,000…

A: We have the following information: Opening Inventory: $380,000 Sales: $650,000 Purchases: $480,000…

Q: Fosbre Corporation’s April 30 inventory was destroyed by fire. January 1 inventory was $150,000, and…

A: Step 1: Calculate the cost of goods sold.

Q: LAVARN Company sells milled rice in Isabela Province. On September 15, a flood destroyed the…

A: Cost of goods sold = Sales - Gross profit where, Gross profit = Sales x Gross profit ratio

Q: On March 1, AYE Merchandising had an inventory of P560,000 in its retail store. Purchases made in…

A: Loss by Fire - Loss by fire or any other natural calamities is an extraordinary loss for the…

Q: On October 31, 2010, a flood at Pamela Company’s only warehouse caused severe damage to its entire…

A: Cost of goods sold:- It refers to the direct cost of producing the goods sold by a company. This…

Q: On 1st Nov 2020, a business had inventory of $380,000. During the month,  sales totalled $650,000…

A: Data given: Opening inventory = $380,000 Purchase during the month= $480,000 Sales during the month…

Q: On June 30, a fire destroyed Intense Company's entire inventory. The inventory on January 1 totaled…

A: Cost of goods sold = P7800000 × 70%       =   P5460000

Q: Riverbed Inc.’s April 30 inventory was destroyed by the explosion of an underground oil tank.…

A: The ending inventory is the inventory that is left unsold in the business.

Q: On January 1, a store had inventory of $48,000. January purchases were $46,000 and January sales…

A: A Inventory balance - Beginning 1 Jan $48,000 B Purchase to date $46,000 C Cost of…

Q: On 1 September 20X6, a business had inventory of $380,000. During the month, sales totalled…

A: We have the following information On 1 September 20X6, a business had inventory of $380,000 During…

Q: On January 1, a store had inventory of P 48,000. January purchases were P 46,000 and January sales…

A: Gross profit = (Net sales/1.25)*.25 = (90000/1.25)*.25 = P18,000 Cost of goods sold = Net sales  -…

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.