Punjab Company, Ltd. reported the following information for November and December 2017.
____________________________________November December
Cost of goods purchased.......................Rs5,000,000.............Rs 6,000,000
Inventory, beginning-of-month..................1,000,000..................1,200,000
Inventory, end-of-month..........................1,200,000...........................?
Sales revenue.......................................7,500,000...............10,000,000
Punjab's ending inventory at December 31 was destroyed in a fire.
Instructions
(a) Compute the gross profit rate for November.
(b) Using the gross profit rate for November, determine the estimated cost of inventory lost in the fire.