On February 26 a hurricane destroyed the entire inventory stored in a warehouse owned by the Rockford Corporation. The following information is available from the records of the companys periodic inventory system: beginning inventory, $290,000; purchases and net sales from the beginning of the year through February 26, $540,000 and $740,000, respectively; gross profit ratio, 30%.

Estimate the cost of the inventory destroyed by the hurricane using the gross profit method.