Question

LP 10-21 Slidl ) WeSUll me In the current year, Aldin Company experienced a major casually loss due to the destruction of its warehouse and entire inventory by a hurricane. The company began the year with inventory of $816,000. There were net purchases of $1,019,000 and net sales of $5,011,000 during the year prior to the casualty The company's historical gross profit percentage has averaged 40% over the last 5 years. Estimate the inventory on hand on the date of the casualty. The estimated inventory on hand on the date of the casually is S

Answer 1

А В 1 Estimated inventory on hand: 2 Beginning inventory 3 Net purchases 4 Less: Cost of goods sold $816,000 $4,019,000 $3.006,600 $1,.828.400 5 Estimated inventory on hand on the date of casualty Calculations are shown below А В 1 Estimated inventory on hand: 2 Beginning inventory 3 Net purchases 4 Less: Cost of goods sold 5 Estimated inventory on hand on the date of casualty B2+B3-B4 816000 4019000 =5011000-(5011000*40%)