PART 2 Answers that receive full credit should be: well organized, use data inputs and use Excel features to make calculations. A firm's inventory was destroyed by fire on August 14 of the current year. Fortunately, the firm had insurance to cover the loss. However, most of the inventory records were also destroyed in the fire. The average gross margin percentage is 40%, beginning inventory was $200,000, and $1,000,000 of purchases had been made through August 13. The firm had recorded sales of $1,200,000 through that date. Estimate the cost of the inventory lost in the fire. Loft Co. reviewed its LIFO inventory values for proper pricing at year-end. The following summarizes two inventory items examined for the lower of cost or market: Inventory #1 Inventory #2 Original cost 210,000 400,000 Replacement cost 150,000 370,000 Net realizable value 240,000 410,000 Net realizable value less profit margin 208,000 405,000 What amount should Loft include in inventory at year-end, if it uses the total of the inventory to apply the lower of cost or market