On February 26 a hurricane destroyed the entire inventory stored in a warehouse owned by the Rockford Corporation. The following information is available from the records of the company’s periodic inventory system: beginning inventory, $220,000; purchases and net sales from the beginning of the year through February 26, $400,000 and $600,000, respectively; gross profit ratio, 30%.   Estimate the cost of the inventory destroyed by the hurricane using the gross profit method.       Beginning inventory     Plus: Net purchases     Cost of goods available for sale     Less: Cost of goods sold:     Net sales     Less: Estimated gross profit     Estimated cost of goods sold     Estimated cost of inventory destroyed

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

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A: In case of F.O.B shipping, the ownership relating to goods is transferred to the purchaser (buyer)…

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

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Q: Data table Inventory, December 1 Transactions December 1-15: Purchases Purchases discounts Purchase…

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Q: In its first month of operations, Sheridan Company made three purchases of merchandise in the…

A: In organization, there are two system for inventory valuation. (1) Perpetual Inventory system (2)…

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A: As per last-in, first-out method units sold from inventory are the units that have been purchased…

Q: Adams Corporation estimates that it lost $75,000 in inventory from a recent flood. The following…

A: Formula to calculate gross profit ratio:

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: Coronado Company took a physical inventory on December 31 and determined that goods costing $199,600…

A: The inventory valuation method used to evaluate the closing inventory and cost of goods sold on the…

Q: The following information is taken from the books of All in the Family Center for the first quarter…

A: Cost of goods sold: The cost of goods sold is the amount of money paid by a company to purchase or…

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A: Inventory valuation is a method of finding the actual cost of the goods left unsold at the end of a…

Q: Lily Company needs to determine the amount of inventory in its warehouse at the time that an…

A: Cost of goods available for sale = Beginning inventory + purchases Cost of goods sold = Sales -…

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: Crane Inc. took a physical inventory at the end of the year and determined that $787k of goods were…

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A: The LIFO strategy works under the presumption that the last item of stock acquired, is the item that…

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A: The inventory can be valued using various methods as LIFO, FIFO and weighted average method.

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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: At the beginning of Year 2, Donald Company had $8,600 of inventory on hand. During the accounting…

A: The cost of goods available for sale refers to the value of goods that the company offers to the…

Q: Dublin Corporation provides the following information related to its inventory during the month of…

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Q: Marigold Corporation's April 30 inventory was destroyed by fire. January 1 inventory was $164,900,…

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Q: Z Wholesale Company began the year with merchandise inventory of $5,000. During the year, Z…

A: Net purchases :— It is gross purchases less purchase return & allowance less purchase discount.…

Q: At the end of last year, Helen's, Inc. (uses a periodic inventory system with a physical inventory…

A: Periodic Inventory SystemA periodic inventory system is an approach to inventory management in a…

Q: average cost inventory valuation system. Yakal makes a physical count at the end of each month…

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Q: A review of the accounting records of the Danzee Company yields the following information concerning…

A: Ending inventory is the amount of goods left with the entity. These are reported in the balance…

Q: Seneca Co. began the year with 6,500 units of product in its January 1 inventory costing $35 each.…

A: Given: Seneca Co. began the year with 6,500 units of product in its January 1 inventory costing $35…

Q: Blue Spruce Corporation's March 31 inventory was destroyed by fire. January 1 inventory was…

A: We assume that all the inventory of 31 March was destryed by the fire.

Q: e Westmoreland Corporation uses a periodic system for its inventory. The company starts the current…

A: Cost is the expenses which have been incurred for production, marketing and selling a product, from…

Q: In its hrst month of operations, Sunland Company made three purchases of merchandise in the…

A: FIFO method is one of the methods of inventory valuation in which it is assumed that old purchases…

Q: To more efficiently manage its inventory, Telnex Corporation maintains its internal inventory…

A: "Since you have posted a question with multiple sub-parts, we will solve the first three sub-parts…

Q: Wildhorse Company reported the following information for November and December 2022.     November…

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Q: Concord Inc. took a physical inventory at the end of the year and determined that $832000 of goods…

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A: INVENTORY VALUATION   Inventory Valuation is a Method of Calculation of Value of Inventory at the…

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A: FOB Shipping point goods are shipped, so this will be included in the inventory. Goods on…

Q: Ashvinbhai

A: The objective of the question is to estimate the LIFO cost of ending inventory and cost of goods…

Q: Apply the COGS equation used on the bottom of page 6-3 of the VLN to the following data set to…

A: The cost of goods sold is calculated as difference between cost of goods available for sale and…

Q: Wildhorse Company took a physical inventory on December 31 and determined that goods costing…

A: In case of sale of 37000 control will transfer when goods reach to destination ,but they are in…

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.