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Gross Profit Method: Estimation of Fire Loss On September 28, 2016, a fire destroyed the entire merchandise inventory of Carroll Corporation. The following information is

Gross Profit Method: Estimation of Fire Loss

On September 28, 2016, a fire destroyed the entire merchandise inventory of Carroll Corporation. The following information is available:

Sales, January 1September 28, 2016 $560,000
Inventory, January 1, 2016 $150,000
Merchandise purchases, January 1September 28, 2016 (including $50,000 of goods in transit on September 28, 2016, shipped FOB shipping point) $476,000
Markup percentage on cost 25%

Required:

What is the estimated inventory on September 28, 2016, immediately prior to the fire?

CARROLL CORPORATION
Calculation of estimated inventory on
September 28, 2016 (prior to the fire)
Beginning inventory $
Purchases on hand
Cost of goods available for sale $
Less: Cost of goods sold
Inventory on hand September 28, 2016, and destroyed by the fire $

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