On June 19, 20X0, a fire destroyed the entire uninsured merchandise inventory of the ABC Merchandising Company. The following data are available: Inventory, January 1 - P 90,000 Purchases, January 1 through June 19 - 660,000 Sales, January 1 through June 19 - 876,000 Sales discount – 6,000 Markup percentage on cost - 20% What is the approximate inventory loss as a result of the fire?

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

A: Given,  Gp ratio = 40% = 100 * Gross profit / Net sales Purchase = 420000 Net sales = 620000…

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: Sarasota Lumber Company handles three principal lines of merchandise with these varying rates of…

A: Inventories are the current assets held for sale or manufacture in the ordinary course of business.…

Q: Allgone Company's inventory was destroyed by fire. Its records show net sales of $90,000, beginning…

A: Answer:-  Ending inventory:- The value of products still on the hand and available for sale by an…

Q: On April 31 2017 KIFOs store room was destroyed by fire. KIFO requires an estimate of the cost of…

A: Sales given is 1,080,000, using sales calculate the Cost of goods sold. Formula for cost of goods…

Q: Harry Company's reoords indicate the following information: Merchandise inventory, January 1, 200X7…

A: Closing inventory means the amount of inventory in hand at the end of specified period. We can apply…

Q: Over the past 3 years, the gross profit rate for Jini Company was 30%. Last week a fire destroyed…

A: Inventory destroyed = Beginning inventory + Net purchases - Cost of goods sold Cost of goods sold =…

Q: 4.The following data were available for ABC Stores at Nov. 6, 20X1: Purchases (Jan 1- Nov 5)…

A: 30% of the inventory was lost in the fire Therefore inventory Lost in fire = Closing stock on Nov…

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: A fire completely destroyed all the inventory of Glisan Lumber Yard on August 5, 20--. Fortunately,…

A: The gross profit is calculated as the difference between sales and cost of goods sold. The estimated…

Q: Buffalo Company reported a December 31 ending inventory balance of $412,000. The following…

A: Inventory:The term "inventory" describes both the products that are on the market and the raw…

Q: How much is the loss on fire at Nov 6, 20X1?   a. 3,900 b. 9,150 c. 13,000 d. 30,500

A: Loss on fire :- Inventory on 6th Nov 2021 * 30% Closing inventory on 6th Nov 2021 :- (opening…

Q: A fire destroyed the warehouse of Reed Enterprises, on August 31, 20Y1. The books and records of…

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

Q: Crane Company lost all of its inventory in a fire on December 26, 2022. The accounting records…

A: The cost of goods sold is the formula used to compute the cost incurred on the goods sold during the…

Q: On June 19, 20X0, a fire destroyed the entire uninsured merchandise inventory of the ABC…

A: Cost of goods sold means the cost incurred on the goods which has been sold including all direct…

Q: On August 31, a hurricane destroyed a retail location of Vinny's Clothier including the entire…

A: Effective inventory management is important to the success of any business that sells physical…

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: 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: Confucius Bookstore's inventory is destroyed by a fire on September 5. The following data for the…

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

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

A: working note 1. Gross profit  margin  formula =Gross profit/Net sales * 100 Gross profit will be…

Q: On September 22, 2016, a flood destroyed the entire merchandise inventory on hand in a warehouse…

A: Gross profit method:

Q: Domestic

A: let me re-work this step-by-step to find the correct cost of goods destroyed. Given information:-…

Q: On April 15 of the current year, a fire destroyed the entire uninsured inventory of a retail store.…

A: >Ending inventory is the amount of inventory left on hand at the end of period. >Due to…

Q: Rahul

A: To compute the cost of goods destroyed, just please follow the following steps: Step 1: Calculate…

Q: Scotland Inc. incurred a fire loss. Select information follows:   Gross profit: Markup on cost…

A: The gross profit method is the method that helps in estimating the value of inventory considering…

Q: A flood on 30th Nov destroyed some of a company’s inventory and its inventory records. The following…

A: Lets understand the basics. When due to any reason inventory gets destroyed then it needs to record…

Q: Question: On November 21, 2013, a fire at Hodge Company's warehouse caused severe damage to its…

A: Explanation of Gross Profit:Gross profit is a key financial metric that represents the difference…

Q: E6.18 modified The inventory of Ipswich Books was destroyed by fire on March 1. From an examination…

A: The objective of the question is to calculate the value of the merchandise lost by fire under two…

Q: mation is available:   Sales, January 1 through July 8 $ 700,000 Inventory, January 1 130,000…

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

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

A: Cost of goods sold means the cost of goods which has been actually sold out during the year. When we…

Q: A company's store was destroyed by an earthquake on February 10. Only the following information for…

A: Cost of goods sold = Net sales - Gross profit where, Gross profit = Net sales x Gross profit rate

Q: A fire destroyed all ABC's merchandise inventory on October 1. On January 1 the balance in inventory…

A: Gross profit margin = Sales * 32/132Estimated cost of goods sold = Sales * 100/132Estimated…

Q: he following information is available for October for Pharoah Company. (Round answers to 0 decimal…

A: solution: given Beginning inventory $320000 Net purchases 1040000 Net sales…

Q: : Which misstatement below is more difficult to detect? Explain. (i)The inventory costing $ 150,000…

A:

Q: E6.18 modified The inventory of Ipswich Books was destroyed by fire on March 1. From an examination…

A: The objective of the question is to calculate the value of the merchandise lost by fire under two…

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: Suppose Alpine Sportswear suffered a fire loss and needs to estimate the cost of the goods…

A: Gross Margin = (Total Revenue – Cost of Goods Sold)/Total Revenue

Q: A fire completely destroyed all the inventory of Glisan Lumber Yard on August 5, 20- -. Fortunately,…

A: Gross profit = sales * gross profit percentage

Q: . Nectarine Company lost most of its inventory in a fire in December, 2021, just before the year-…

A: The question is related to calculation of loss as a result of fire. We will first calculate the…

Q: 44.The following data were available for ABC Corp at Nov 7, 20X2: Net purchases ( Jan 1-Nov 7)…

A: The Value of Closing Inventory will be ascertain by preparing Trading Account for the period.

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

A:

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

A: 1. Cost of Goods Destroyed - Cost of Goods Destroyed by fire is the goods destroyed and reduced from…

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.