ESTIMATING ENDING INVENTORY. Annapolis Company is preparing its financial statements for the first quarter of the year. Rather than taking a physical inventory, Annapolis will estimate ending inventory. As of March 31, the following data are available:

Assume that Annapolis uses a periodic inventory accounting system.
REQUIRED:
Estimate cost of goods sold and ending inventory.

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Beginning inventory Sales revenue $ 45,000 425,000 Sales returns 12,000 Purchases 257,000 Purchase returns 4,000 Transportation-in 2,000 Estimated gross margin rate .38