Painting Supplies suffered a terrible tornado, and its entire merchandise inventory was destroyed. Painting Supplies needs to estimate its ending merchandise inventory to collect insurance. The company’s merchandise inventory records reveal-the following data:

Requirements
1. Estimate the cost of the March 31 merchandise inventory, using the retail method. Assume Painting Supplies had net sales revenue of $ 1,200,000 during March. (Round the cost to retail ratio to the nearest percent.)
2. Prepare the March 2015 partial income statement through gross profit for PaintingSupplies.

Transcribed Image Text:

Cost Retail Merchandise Inventory, March 1 Transactions during March S 108,000 129,600 Purchases Purchase Discounts Purchase Returns and Allowances 3,000,000 3,600,000 70,000 16,000 58,000 14,000