Gross Profit Method: Estimation of Flood Loss on November 21, 2016, a flood at Hodge Company's warehouse caused severe damage to its entire inventory of Product Tex. Hodge estimates that all usable damaged goods can be sold for $10,000. The following information was available from Hodge's accounting records for Product Tex: Inventory at November 1, 2016 $100,000 Purchases from November 1, 2016, to date of flood 140,000 Net sales from November 1, 2016, to date of flood 220,000 Based on recent history, Hodge had a gross margin (profit) on Product Tex of 30% of net sales. Required: 1. Prepare a schedule to calculate the estimated loss on the inventory in the food, using the gross profit method. HODGE COMPANY of Estimated Loss on Inventory in the Flood Using Gross Margin (Profit) Method November 21, 2016 Inventory at November 1, 2016 Purchases from November 1, 2016, to date of flood Cost s available for sale Estimated cost of goods sold Net sales from November 1. 201 to date of flood