Castlevania Company lost most of its inventory in a fire in December just before the year-end physical

Question:

Castlevania Company lost most of its inventory in a fire in December just before the year-end physical inventory was taken. The corporation's books disclosed the following.

Beginning inventory $170,000 Sales $650,000

Purchases for the year 450,000 Sales returns 24,000

Purchase returns 30,000 Rate of gross margin on net sales 30%

Merchandise with a selling price of $21,000 remained undamaged after the fire. Damaged merchandise with an original selling price of $15,000 had a net realizable value (after the fire) of $5,300.

Compute the amount of the loss as a result of the fire, assuming that the corporation had no insurance coverage. Fire loss on inventory $?

Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...