Answered step by step
Verified Expert Solution
Question
1 Approved Answer
lint Company lost most of its inventory in a fire in December just before the year-end physical inventory was taken. The corporations books disclosed the
lint Company lost most of its inventory in a fire in December just before the year-end physical inventory was taken. The corporations books disclosed the following.
Beginning inventory | $161,400 | Sales revenue | $632,700 | ||||
Purchases for the year | 398,600 | Sales returns | 26,400 | ||||
Purchase returns | 33,000 | Rate of gross profit on net sales | 40 | % |
Merchandise with a selling price of $22,200 remained undamaged after the fire. Damaged merchandise with an original selling price of $14,700 had a net realizable value of $5,400. Compute the amount of the loss as a result of the fire, assuming that the corporation had no insurance coverage.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started