E9.16-(LO.4) (Gross Profit-Method) .Wallace Company lost most of its inventory in a fire in December just- before the year-end physical inventory was taken. The corporation's books disclosed the following. . I Beginning inventory $170,000 Sales revenue $650,000 Purchases for the year 390,000 Sales returns 24,000 Purchase returns 30,000 Rate of gross profit on net sales 40% Merchandise with a selling price of $21,000 remained undamaged after the fire. Damaged merchandise with an original selling price of $15,000 had a net realizable value of $5,300. " Instructions. " Compute the amount of the loss as a result of the fire, assuming that the corporation had no insurance coverage."