Sarasota Lumber Company handles three principal lines of merchandise with these varying rates of gross profit on cost.LumberMillworkHardware and fittings25%30%40%On August 18, a fire destroyed the office, lumber shed, and a considerable portion of the lumber stacked in the yard. To file a report ofloss for insurance purposes, the company must know what the inventories were immediately preceding the fire. No detail or perpetualinventory records of any kind were maintained. The only pertinent information you are able to obtain are the following facts from thegeneral ledger, which was kept in a fireproof vault and thus escaped destruction.Inventory $Inventory, Jan. 1, 2025Purchases to Aug. 18, 2025Sales revenue to Aug. 18, 2025LumberLumber$247,6001,521,6002,111,100Millwork$88,900372,700483,600Hardware$45,700Submit your estimate of the inventory amounts immediately preceding the fire. (Round ratios for computational purposes to 5 decimalplaces, e.g. 78.74265% and final answers to O decimal places, e.g. 28,987.)Millwork159,000221,200$Hardware

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

Answered: Sarasota Lumber Company handles three…

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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Cullumber Legler requires an estimate of the cost of goods lost by fire on March 9. Merchandise on hand on January 1 was $ 49,400. Purchases since January 1 were $ 93,600; freight-in, $ 4,420; purchase returns and allowances, $ 3,120. Sales are made at 33 /3% above cost and totaled $ 156,000 to March 9. Goods costing $ 14,170 were left undamaged by the fire; remaining goods were destroyed.
Cullumber Legler requires an estimate of the cost of goods lost by fire on March 9. Merchandise on hand on January 1 was $ 49,400. Purchases since January 1 were $ 93,600; freight-in, $ 4,420; purchase returns and allowances, $ 3,120. Sales are made at 33 1/3% above cost and totaled $ 156,000 to March 9. Goods costing $ 14,170 were left undamaged by the fire; remaining goods were destroyed
Sheridan Legler requires an estimate of the cost of goods lost by fire on March 9. Merchandise on hand on January 1 was $44,080. Purchases since January 1 were $83, 520; freight - in, $3, 944; purchase returns and allowances, $2,784. Sales are made at 33 1/3% above cost and totaled $135,000 to March 9. Goods costing $12, 644 were left undamaged by the fire; remaining goods were destroyed
A substantlal portlon of Inventory owned by Prentiss Sporting Goods was recently destroyed when the roof collapsed during a ralnstorm. Prentiss also lost some of Its accounting records. Prentiss must estimate the loss from the storm for Insurance reporting and financial statement purposes. Prentiss uses the perlodic Inventory system. The following accounting information was recovered from the damaged records. Beginning inventory $196, eee 398, e00 Purchases to date of storm Sales to date of storm бее, вее The value of undamaged Inventory counted was $102,676. Hıstorically, Prentiss' gross margin percentage has been approximately 22 percent of sales. Required Estimate the following: a. Gross margin in dollars. b. Cost of goods sold in dollars. c. Ending Inventory. d. Amount of lost Inventory. a. Gross margin b. Cost of goods sold C. Estimated ending inventory d. Inventory lost
A fire completely destroyed the entire inventory of Printing Delight Co. on March 15, 20--. Fortunately, the books were not destroyed in the fire. The following information is taken from the books of Printing Delight Co. for the time period, January 1, 20-- through March 15, 20--: Beginning inventory, January 1, 20-- $45,000 Net purchases, January 1, through March 15, 20-- 252,000 Net sales, January 1, through March 15, 20-- 378,000 Normal gross profit percentage of sales 37% Required: 1. Estimate the cost of goods sold for the time period January 1 through March 15, 20--, using the gross profit method. Estimated cost of goods sold 66,350 x Feedback 2. Estimate the amount of merchandise inventory destroyed in the fire on March 15, 20--, using the gross profit method. Estimated inventory on March 15, 20-- 22,275 x Feedback
Brad Essary owned a small company that sold garden equipment. The equipment was expensive, and a perpetual system was maintained for control purposes. Even so, lost, damaged, and stolen merchandise normally amounted to 5 percent of the inventory balance. On June 14, Essary's warehouse was destroyed by fire. Just prior to the fire, the accounting records contained a $154,500 balance in the Inventory account. However, inventory costing $11,100 had been sold and delivered to customers but had not been recorded in the books at the time of the fire. The fire did not affect the showroom, which contained inventory that cost $41,200. Required Estimate the amount of inventory destroyed by fire. Inventory destroyed by fire
Ivanhoe Music Company sells three principal types of musical instruments, with varying percentages of gross profit on cost. Harps Violins Cellos Gross profit percentage 30% 35% 40% On May 9, 2020 a fire destroyed Ivanhoe's office and the warehouse in which it stored the instruments. To file a report of loss for insurance purposes, the company must know what the inventories were immediately preceding the fire. Unfortunately Ivanhoe Music Company did not maintain any perpetual inventory records. A general ledger was kept and computer records related to the ledger were backed up to the cloud nightly. You were able to ascertain the following from the general ledger. Harps Violins Cellos Inventory, Jan. 1, 2020 $208,000 $124,800 $156,000 Purchases to May 9, 2020 156,000 52,000 78,000 Sales Revenue to May 9, 202O 304,200 154,440 247,520 Submit your estimate of the inventory amounts immediately preceding the fire. Harps Violins Cellos Inventory $ $
Sandhill Legler requires an estimate of the cost of goods lost by fire on March 9. Merchandise on hand on January 1 was $ 37,240. Purchases since January 1 were $ 70,560; freight-in, $ 3,332; purchase returns and allowances, $ 2,352. Sales are made at 33 1/3% above cost and totaled $ 111,000 to March 9. Goods costing $ 10,682 were left undamaged by the fire; remaining goods were destroyed.
On January 1, a store had inventory of $48,000. January purchases were $46,000 and January sales were $95,000. On February 1 a fire destroyed most of the inventory. The rate of gross profit was 20% of sales. Merchandise with a selling price of $5,000 remained undamaged after the fire. Compute the amount of the fire loss, assuming the store had no insurance coverage. Label all figures.
7. The inventory was destroyed by fire on December 31. The following data were obtained from the accounting records:

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