Lily Company lost all of its inventory in a fire on December 26, 2022. The accounting records showed the following inventory-related data for November and December.

a) Compute the gross profit rate for November.

b) Using the gross profit rate for November, determine the estimated cost of the inventory lost in the fire.

		November		December (to 12/26)
Net sales		$520,000		$630,000
Beginning inventory		33,000		37,000
Purchases		381,000		423,000
Purchase returns and allowances		13,500		14,800
Purchase discounts		8,500		9,500
Freight-in		9,000		10,000
Ending inventory		37,000		?