Hestor Company’s records indicate the following information:

On December 31, 2008 a physical inventory determined that ending inventory of $600,000 was in the warehouse. Hestor’s gross profit on sales has remained constant at 30%. Hestor suspects some of the inventory may have been taken by some new employees.
Required:
At December 31, 2008, what is the estimated cost of missing inventory?

Transcribed Image Text:

Merchandise inventory, January 1, 2008 Purchases, January 1 through December 31, 2008 Sales, January 1 through December 31, 2008 $ 550,000 2,250,000 3,000,000