1. Gross Profit Method Royal Gorge Company uses the gross profit method to estimate ending inventory and cost of goods sold when preparing monthly financial statements required by its bank. Inventory on hand at the end of October was $56800. The following information for the month of November was available from company records: The following informaton euired by its bank. d cost of Purchases of $113000 Freight-in of $3800 Sales of $180000 Sales Returns of $4500 Purchase Returns of $2700 In addition, the controller is aware of $8200 of inventory that was stolen during November from one of the company's warehouses