On 1st Jan 2006, a business had inventory of $19,000. During the month, sales totalled $32,500 and purchases $24,000. On 31st Jan 2006 a fire destroyed some of the inventory. The undamaged goods in inventory were valued at $11,000. The business operates with a standard gross profit margin of 30%. Based on this information, what is the cost of the inventory destroyed in the fire?

On 1st Jan 2006, a business had inventory of $19,000. During the month, sales totalled $32,500 and purchases $24,000. On 31st Jan 2006 a fire destroyed some of the inventory. The undamaged goods in inventory were valued at $11,000. The business operates with a standard gross profit margin of 30%. Based on this information, what is the cost of the inventory destroyed in the fire?

Century 21 Accounting Multicolumn Journal

11th Edition

ISBN:9781337679503

Author:Gilbertson

Publisher:Gilbertson

Chapter20: Accounting For Inventory

Section: Chapter Questions

Problem 1CP

See similar textbooks

Similar questions

On 1 September 20X6, a business had inventory of $380,000. During the month, sales totalled $650,000 and purchases $480,000. On 30 September 20X6 a fire destroyed some of the inventory. The undamaged goods in inventory were valued at $220,000. The business operates with a standard gross profit margin of 30%. Based on this information, what is the cost of the inventory destroyed in the fire?
On 1st Nov 2020, a business had inventory of $380,000. During the month, sales totalled $650,000 and purchases $480,000. On 30th Nov 2020 a flood destroyed some of the inventory. The undamaged goods in inventory were valued at $220,000. The business operates with a standard gross profit margin of 25%.Based on this information, what is the cost of the inventory destroyed in the flood?
On January 1, a store had inventory of $48,000. January purchases were $46,000 and January sales were $95,000. On February 1 a fire destroyed most of the inventory. The rate of gross profit was 20% of sales. Merchandise with a selling price of $5,000 remained undamaged after the fire. Compute the amount of the fire loss, assuming the store had no insurance coverage. Label all figures.
On January 1 a store had inventory of P55,000. January purchases were P46,000 and January sales were P105,000. On February 1 a fire destroyed most of the inventory. The rate of gross profit was 25% of cost. Merchandise with a selling price of P7,500 remained undamaged after the fire. Compute the amount of the fire loss, assuming the store had no insurance coverage.
On January 1, a store had inventory of P 48,000. January purchases were P 46,000 and January sales were P 90,000. On February 1 a fire destroyed most of the inventory. The rate of gross profit was 25% of cost. Merchandise with a selling price of P 5,000 remained undamaged after the fire. Compute the amount of the fire loss, assuming the store had no insurance coverage
Lily Company needs to determine the amount of inventory in its warehouse at the time that an earthquake destroyed it. Lily's gross profit percentage averaged 27% over the last three years. Lily began the current year with inventory of $840,000. Its net purchases were $4,387,000 and net sales were $3,970,000 during the year before the earthquake occurred. Use the gross profit method to estimate the inventory on hand on the date of the earthquake. Identify the appropriate formula and then calculate Lily's estimated ending inventory. Estimated ending inventory !!
Over the past 3 years, the gross profit rate for Jini Company was 42%. Last week a fire destroyed all Jini’s inventory. Beginning inventory $ 6,350 Net purchases 64,700 Net sales at retail 49,700 Using the gross profit method, estimate the cost of inventory destroyed in the fire, given the above facts that were recorded in a fireproof safe. inventory destroyed?
Coastal Shores Inc. (CSI) was completely destroyed by Hurricane Fred on August 5, 2013. At January 1, CSI reported an inventory of $170,000. Sales from January 1, 2013, to August 5, 2013, totaled $480,000 and purchases totaled $195,000 during that time. CSI normally shows a gross profit percentage of 40%. The estimated inventory loss due to Hurricane Fred would be:
Butterfly Company began October with inventory of $192,000. The business made net purchases of $635,000 and had net sales of $910,000 before a fire destroyed the company's inventory. For the past several years, Butterfly Company's gross margin on sales has been 38 percent. Required 1. Estimate the cost of the inventory destroyed by the fire 2. Identify another reason owners and managers use the gross margin method to estimate inventory on a regular basis Requirement 1. Estimate the cost of the inventory destroyed by the fire Cost of goods available for sale Estimated cost of goods sold Less Estimated cost of inventory destroyed Requirement 2. Identify another reason owners and managers use the gross margin method to estimato inventory on a regular basis. Another reason owners and managers use the gross margin method to estimate inventory cost on a regular basis is to determine
On March 15, a fire destroyed MyCompany's entire retail inventory. The inventory on hand as of January 1 totaled $1,650,000. From January 1 through the time of the fire, the company made purchases of $683,000, incurred freight-in of $78,000, and had sales of $1,210,000. Assuming the rate of gross profit to selling price is 30%, what is the approximate value of the inventory that was destroyed ?
On June 30, a fire destroyed Intense Company's entire inventory. The inventory on January 1 totaled P6,600,000. From January 1 through the time of the fire, the entity made purchases of P3,000,000, incurred freight in of P300,000, and had sales of P7,800,000. The rate of gross profit on selling price is 30%. What is the approximate cost of the inventory that was destroyed? 3,600,000 C. 4,140,000 3,900,000 D. 4,440,000
Blue Corporation's April 30 inventory was destroyed by fire. January 1 inventory was $155,000, and purchases for January through April totaled $467,300. Sales revenue for the same period was $684,500. Blue's normal gross profit percentage is 25% on sales. Using the gross profit method, estimate Blue's April 30 inventory that was destroyed by fire. Estimated ending inventory destroyed in fire $