Question

Int Practice and ons Manual Question 8 CPAexcel Con- Access View Policies Current Attempt in Progress ssions Windsor Lumber Company handles three principal lines of merchandise with these varying rates of gross profit on cost. erences borations PLUS Support Lumber 25% Millwork 30% Hardware and fittings 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 of loss for insurance purposes, the company must know what the inventories were immediately preceding the fire. No detail or perpetual inventory records of any kind were maintained. The only pertinent information you are able to obtain are the following facts from the general ledger, which was kept in a fireproof vault and thus escaped destruction. Lumber Millwork Hardware Inventory, Jan. 1, 2020 $254.900 $89,500 $45,000 Purchases to Aug. 18, 2020 1,488,400 381,300 160,400 Sales to Aug. 18, 2020 2,085,700 536,900 215,600 Submit your estimate of the inventory amounts immediately preceding the fire. (Round ratios for computational purposes to 5 decimal places, e.g. 78.74265% and final answers to O decimal places, e.g. 28,987.) Lumber Millwork Hardware Inventory $

Answer 1

Answer

	Limber	Millwork	Hardware
Inventory	$74,740	$57,800	$51,400

--Working

		Limber	Millwork	Hardware
A	Sales	$2,085,700	$536,900	$215,600
B	GP % on cost	25%	30%	40%
C = 100% + B	Sale as a % of cost	125.00%	130.00%	140.00%
D = A/C	Cost of Goods Sold	$1,668,560	$413,000	$154,000
E	Beginning Inventory	$254,900	$89,500	$45,000
F	Purchases	$1,488,400	$381,300	$160,400
G = E+F	Cost of Goods available for sale	$1,743,300	$470,800	$205,400
H = G - D	Inventory [ending]	$74,740	$57,800	$51,400