Practice Question 36

Viewpoint Companys October 31 inventory was destroyed by fire. The companys beginning inventory was $500,000, and purchases for January through October were $1,200,000. Sales for the same period were $1,800,000. The companys normal gross profit percentage is 30% of sales. Using the gross profit method, the October 31 inventory is estimated to be

$300,000.

$540,000.

$440,000.

$40,000.