Sporting Pro wants to prepare Interim financlal statements for the first quarter of 2020 but would like to avold making a physical countof Inventory. During the last five years, the company's gross profit rate has averaged 47%. The following information for the year's firstquarter Is avallable from Its records:January 1 beginning inventory350, 260Purchases995, 200Purchase returns14,eseTransportation-in7,900Sales1,291,150Sales returns9,950Requlred:Use the gross profit method to prepare an estimate of the company's March 31 inventory.SPORTING PROEstimated InventoryMarch 31, 2020Goods available for sale:Goods available for saleEstimated cost of goods sold:

Solution:- Calculation of ending inventory using gross profit method as follows:-

Sporting Pro wants to prepare Interim financial statements for the first quarter of 2020 but would like to avoid making a physical count of inventory. During the last five years, the company's gross profit rate has averaged 47%. The following Information for the year's first quarter is avallable from its records: January 1 beginning inventory Purchases 350, 260 995, 200 Purchase returns 14,ese Transportation-in Sales 7,900 1,291, 15e Sales returns 9,95e Requlred: Jse the gross profit method to prepare an estimate of the company's March 31 Inventory. SPORTING PRO Estimated Inventory March 31, 2020 Goods available for sale: Goods available for sale Estimated cost of goods sold:

Sporting Pro wants to prepare Interim financial statements for the first quarter of 2020 but would like to avoid making a physical count of inventory. During the last five years, the company's gross profit rate has averaged 47%. The following Information for the year's first quarter is avallable from its records: January 1 beginning inventory Purchases 350, 260 995, 200 Purchase returns 14,ese Transportation-in Sales 7,900 1,291, 15e Sales returns 9,95e Requlred: Jse the gross profit method to prepare an estimate of the company's March 31 Inventory. SPORTING PRO Estimated Inventory March 31, 2020 Goods available for sale: Goods available for sale Estimated cost of goods sold:

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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