Homework Help is Here – Start Your Trial Now!
Business
Accounting
On September 22, 2021, a flood destroyed the entire merchandise inventory on hand in a warehouse owned by the Rocklin Sporting Goods Company. The following information is available from the records of the company's periodic inventory system: Inventory, January 1, 2021 Net purchases, January 1 through September 22 Net sales, January 1 through September 22 Gross profit ratio $147,000 377,000 585,000 254 Required: Complete the below table to estimate the cost of inventory destroyed in the flood 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 24

On September 22, 2021, a flood destroyed the entire merchandise inventory on hand in a warehouse owned by the Rocklin Sporting Goods Company. The following information is available from the records of the company's periodic inventory system: Inventory, January 1, 2021 Net purchases, January 1 through September 22 Net sales, January 1 through September 22 Gross profit ratio $147,000 377,000 585,000 254 Required: Complete the below table to estimate the cost of inventory destroyed in the flood 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 24

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
See similar textbooks
icon
Related questions
Question

What are the blanks? 

**Rocklin Sporting Goods Company Inventory Loss Estimation Due to Flood** On September 22, 2021, a flood destroyed the entire merchandise inventory in a warehouse owned by the Rocklin Sporting Goods Company. The following data was available from the company's periodic inventory records: - **Inventory, January 1, 2021:** $147,000 - **Net purchases, January 1 through September 22:** $377,000 - **Net sales, January 1 through September 22:** $585,000 - **Gross profit ratio:** 25% **Calculation Requirement:** The task is to estimate the cost of the inventory destroyed in the flood using the gross profit method. A table is provided to assist in this calculation, following these steps: 1. **Beginning inventory:** $147,000 2. **Plus: Net purchases:** $377,000 **Cost of goods available for sale:** Sum of beginning inventory and net purchases. 3. **Less: Cost of goods sold:** - **Net sales:** $585,000 - **Less: Estimated gross profit (25% of net sales):** To calculate, multiply net sales by the gross profit ratio. - **Estimated cost of goods sold:** Subtract estimated gross profit from net sales. 4. **Estimated cost of inventory destroyed:** Subtract the estimated cost of goods sold from the cost of goods available for sale. The table provides a structured format to fill in these calculations and derive the estimated cost of inventory destroyed, highlighting important values with designated cell references and a yellow-colored section for the final estimated cost.
Transcribed Image Text:**Rocklin Sporting Goods Company Inventory Loss Estimation Due to Flood** On September 22, 2021, a flood destroyed the entire merchandise inventory in a warehouse owned by the Rocklin Sporting Goods Company. The following data was available from the company's periodic inventory records: - **Inventory, January 1, 2021:** $147,000 - **Net purchases, January 1 through September 22:** $377,000 - **Net sales, January 1 through September 22:** $585,000 - **Gross profit ratio:** 25% **Calculation Requirement:** The task is to estimate the cost of the inventory destroyed in the flood using the gross profit method. A table is provided to assist in this calculation, following these steps: 1. **Beginning inventory:** $147,000 2. **Plus: Net purchases:** $377,000 **Cost of goods available for sale:** Sum of beginning inventory and net purchases. 3. **Less: Cost of goods sold:** - **Net sales:** $585,000 - **Less: Estimated gross profit (25% of net sales):** To calculate, multiply net sales by the gross profit ratio. - **Estimated cost of goods sold:** Subtract estimated gross profit from net sales. 4. **Estimated cost of inventory destroyed:** Subtract the estimated cost of goods sold from the cost of goods available for sale. The table provides a structured format to fill in these calculations and derive the estimated cost of inventory destroyed, highlighting important values with designated cell references and a yellow-colored section for the final estimated cost.
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 2 steps with 1 images

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Knowledge Booster
Foreign Stock Market
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education
SEE MORE TEXTBOOKS