Coastal Shores Inc. (CSI) was destroyed by Hurricane Fred on August 5, 2021. At January 1,...

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Coastal Shores Inc. (CSI) was destroyed by Hurricane Fred on August 5, 2021. At January 1,...

Coastal Shores Inc. (CSI) was destroyed by Hurricane Fred on August 5, 2021. At January 1, CSI reported an inventory of $171,000. Sales from January 1, 2021, to August 5, 2021, totaled $481,000 and purchases totaled $196,000 during that time. CSI consistently marks up its products 65% over cost to arrive at a selling price. The estimated inventory loss due to Hurricane Fred would be:

$141,575.
$75,485.
$79,485.
None of these answer choices are correct.

business accounting

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Answer #1

Cost of Goods available for sale = Inventory + Purchases

= 171,000 + 196,000 = 367,000

Cost of Goods Sold = 481,000/165% = 291,515

Goods lost = Cost of Goods available for sale - Cost of Goods Sold

= 367,000 - 291,515

= 75,485

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Coastal Shores Inc. (CSI) was destroyed by Hurricane Fred on August 5, 2021. At January 1,...

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Coastal Shores Inc. (CSI) was destroyed by Hurricane Fred on August 5, 2021. At January 1,...

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Coastal Shores Inc. (CSI) was destroyed by Hurricane Fred on August 5, 2021. At January 1,...