[Accounting Help]

Purchase returns : $4300

. Henderson Company uses the gross prot method to estimate ending inventory and cost of goods sold when preparing monthly naricial statements required by its bank. Inventory on hand at the end of July was $122,500. The following information for the month of August was available from company records: (10 points) Purchases $219,000 Freight-in 5,200 Sales 350,000 Sales returns 9:000 Purchases returns In addition, the controller is aware of $10,000 of inventory that was stolen during August from one of the company's warehouses. Required: 1. Calculate the estimated inventory at the end of August, assuming a gross prot ratio of 30%