Grand Rapids Industrial (GRI) suffered major losses in a fire on June 18, 2013. In addition to destroying several buildings, the blaze destroyed the company's Work in Process Inventory for an entire product line. Fortunately, the company was insured; however, it needs to substantiate the amount of the claim. To this end, the company has gathered the following information that pertains to production and sales of the affected product line:

(1) The company's sales for the first 18 days of June amounted to $230,000. Normally, this product line generates a gross profit equal to 40 percent of sales.

(2) Finished Goods Inventory was $29,000 on June 1 and $42,500 on June 18.

(3) On June 1, Work in Process Inventory was $48,000.

(4) During the first 18 days of June, the company incurred the following costs:

Direct material used	$76,000
Direct labor	44,000
Manufacturing overhead	42,000

Before answering the questions below determine the value of Work in Process Inventory that was destroyed by the fire by using either the equations for COGM and COGS or by using T accounts, assuming GRI uses an actual cost system.

1. What was GRI's Cost of goods sold for the first 18 days in June?

2. What was GRI's goods available for sale for the first 18 days in June?

3. What were the Cost of goods manufactured for the first 18 days in June?

4. What were GRI's total manufacturing costs for the first 18 days in June?

5. Estimate GRI's WIP inventory balance before it was ruined on June 18th by the fire.

6. Reviewing the T account for the WIP account; what is the total credited amount from the account during June 1 - June 18?

7. Reviewing the T account for the Finished Goods account; what is the total credited amount from the account during June 1 - June 18?

8. Assuming the company's raw materials account is solely made up of direct materials. If the ending balance of raw materials on June 18th decreased by $10,000 from June 1 what was the amount of raw materials purchased since June 1?

9. What other information might the insurance company require? Select all that would apply.

A)Market value of the inventory

B)The marketing cost for the month

C)Average percent of completion of the units lost in the fire

D)Number of units forecasted to be produced in future periods

E)Number of units lost in the fire

F)Research and development costs for the product

10. How would management determine or estimate the information required by the insurance company?

Select all that apply.

A) Industry publications for market valuation

B) Marketing department budget

C) Internal documents for shipping and receiving

D) Raw material usage to estimate units produced