Royal Gorge Company uses the gross profit method to estimate ending inventory and cost of goods sold when preparing monthlyfinancial statements required by its bank. Inventory on hand at the end of October was $58,900. The following information for themonth of November was available from company records:PurchasesFreight-inSalesSales returnsPurchases returns$114,0003,400200,0009,0006,000In addition, the controller is aware of $10,000 of inventory that was stolen during November from one of the company's warehousesRequired:1. Calculate the estimated inventory at the end of November, assuming a gross profit ratio of 40%2. Calculate the estimated inventory at the end of November, assuming a markup on cost of 60%.Complete this question by entering your answers in the tabs below.Required 1 Required 2Calculate the estimated inventory at the end of November, assuming a gross profit ratio of 40%.Prov3 of 7Next >

Inventory, based on its intended use and where it is in the manufacturing or distribution process.…

Answered: Purchases Freight-in Sales Sales…

Business

Accounting

Purchases Freight-in Sales Sales returns Purchases returns $114,000 3,400 200,000 9,000 6,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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