CarlaCompany uses the gross profit method to estimate inventory for monthly reporting purposes. Presented below is information for the month of May.

Inventory, May 1 $165,300

Purchases (gross) 619,800

Freight-in 30,100

Sales revenue 940,100

Sales returns 68,700

Purchase discounts 11,600

Compute the estimated inventory at May 31, assuming that the gross profit is 25% of net sales.

The estimated inventory at May 31?

Compute the estimated inventory at May 31, assuming that the gross profit is 25% of cost.

The estimated inventory at May 31?