On November 21, 2021, a fire 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 $12,000. The following information was available from the records of Hodge's periodic inventory system: E 9-9 Gross profit method LO9-2 Inventory, November 1 Net purchases from November 1, to the date of the fire $100,000 Net sales from November 1, to the date of the fire 140,000 220,000 Based on recent history, Hodge's gross profit ratio on Product Tex is 35% of net sales. Required: Calculate the estimated loss on the inventory from the fire, using the gross profit method. (AICPA adapted)