Exercise 6-20 The inventory of Larkspur, Inc. was destroyed by fire on March 1. From an examination of the accounting records, the following data for the first 2 months of the year are obtained: Sales Revenue $51,000, Sales Returns and Allowances $1,100, Purchases $34,000, Freight-In $1,400, and Purchase Returns and Allowances $1,700. Determine the merchandise lost by fire, assuming A beginning inventory of $22,000 and a gross profit rate of 45% on net sales. Estimated cost of merchandise lost A beginning inventory of $31,500 and a gross profit rate of 30% on net sales. Estimated cost of merchandise lost