On March 1, AYE Merchandising had an inventory of P560,000 in its retail store. Purchases made in March amount to P480,000 and March sales total P870,000. On April 1, a fire destroyed most of the inventory and the records kept by the enterprise. Gross profit rate on cost is 25%. Merchandise with a selling price of P10,000 remained undamaged after the fire while inventory with a selling price of P15,000 can be sold for P5.000, What is the estimated amount of fire loss?

On March 1, AYE Merchandising had an inventory of P560,000 in its retail store. Purchases made in March amount to P480,000 and March sales total P870,000. On April 1, a fire destroyed most of the inventory and the records kept by the enterprise. Gross profit rate on cost is 25%. Merchandise with a selling price of P10,000 remained undamaged after the fire while inventory with a selling price of P15,000 can be sold for P5.000, What is the estimated amount of fire loss?

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter10: Cost Analysis For Management Decision Making

Section: Chapter Questions

Problem 2MC: Denali Company manufactures household products such as windows, light fixtures, ladders, and work...

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