Question VI - On January 20, 2011, the records of the Stewart Company revealed the following information: Inventory, July 1, 2010 Purchases, July 1, 2010-January 20, 2011 Sales, July 1, 2010-January 20, 2011 Purchases returns. $ 53,600 368,000 583,000 11,200 Purchases discounts taken $5,800 Freight-in Sales returns 3,800 6,600 A fire destroyed the entire inventory on January 20, 2011 except for purchases in transit, FOB shipping point of $6,000, and goods having a selling price of $4,700 that were salvaged from the fire. The salvaged goods had an estimated cost of $2,900. The average gross profit on net sales in previous periods was 40%. 1. Compute the cost of the inventory lost in the fire.

Question VI - On January 20, 2011, the records of the Stewart Company revealed the following information: Inventory, July 1, 2010 Purchases, July 1, 2010-January 20, 2011 Sales, July 1, 2010-January 20, 2011 Purchases returns. $ 53,600 368,000 583,000 11,200 Purchases discounts taken $5,800 Freight-in Sales returns 3,800 6,600 A fire destroyed the entire inventory on January 20, 2011 except for purchases in transit, FOB shipping point of $6,000, and goods having a selling price of $4,700 that were salvaged from the fire. The salvaged goods had an estimated cost of $2,900. The average gross profit on net sales in previous periods was 40%. 1. Compute the cost of the inventory lost in the fire.

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter9: Current Liabilities And Contingent Obligations

Section: Chapter Questions

Problem 1RE: Rescue Sequences LLC purchased inventory by issuing a 30,000, 10%, 60-day note on October 1. Prepare...

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E6.18 modified The inventory of Ipswich Books was destroyed by fire on March 1. From an examination of the accounting records, the following data for the first two months of the year are obtained: Sales revenue $51,000, Sales returns and allowances $1,000, Purchases $31,200, Freight-in $1,200, and Purchase returns and allowances $1,800. Determine the merchandise lost by fire, assuming: a. A beginning inventory of $20,000 and a gross profit rate of 40% on net sales. b. A beginning inventory of $30,000 and gross profit rate of 25% on cost
Required: Compute for the cost of inventory lost in the fire.
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The problem is stated in the picture. Here is the question: 1. How much is the estimated inventory losses?
A company using the perpetual inventory system purchased inventory worth $25,000 on account with terms of 2/10, n30. Defective inventory of $2,000 was returned two days later, and the accounts wore appropriately adjusted. If the invoice is paid 10 days after the invoice date, the amount of the purchase discount that would be available to the company is A. $490 . $460 C. $500 D. $540
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