Question

Current Attempt in Progress Blossom Legler requires an estimate of the cost of goods lost by fire on March 9. Merchandise on hand on January 1 was $47,880. Purchases since January 1 were $90,720; freight-in, $4,284; purchase returns and allowances, $3,024. Sales are made at 33 1/3% above cost and totaled $150,000 to March 9. Goods costing $13,734 were left undamaged by the fire; remaining goods were destroyed. (a) New attempt is in progress. Some of the new entries may impact the last attempt grading. Your answer is incorrect. Compute the cost of goods destroyed. (Round gross profit percentage and final answer to 0 decimal places, e.g. 15% or 125.) Cost of goods destroyed $

Answer 1

Calculation of Cost of Goods Destroyed:

	$
Merchandise on hand on January 1	47,880
Purchases since January 1	90,720
freight-in	4,284
	142,884
Less;
purchase returns and allowances	(3,024)
Cost of goods sold ($ 150,000/(133 1/3%))	(112,500)
Goods costing were left undamaged by the fire	(13,734)
cost of goods destroyed	13,626