E9-14 (Gross Profit Method) Astaire Company uses the gross profit method to estimate inventory for monthly reporting purposes. Presented below is information for the month of May. Inventory, May 1 ( 160,000 Purchases gross) 640,000 Preight-in 30,000 Sales 1,000,000 Sales returns 70,000 Purchase discounts 12,000 Instructions (a) Compute the estimated inventory at May 31, assuming that the gross profit is 25% of sales (b) Compute the estimated inventory at May 31, assuming that the gross profitis 25% of cost