Question 2 (8 Marks)

The records of McCoy Company provided the following information for the year ended December 31:

Jan. 1: Opening inventory $ 60,200 (at cost)

Merchandise purchased 316,090 (at cost)

Sales 380,900

Sales returns 3,800

Required:

Assuming the gross profit is 38% of net sales, estimate the company's year-end inventory using the

Gross Profit Method.

Marks will be awarded for Cost of Goods Available for Sale (at cost), Net Sales, Estimated Cost of Goods

Sold, and Estimated Year-End Inventory (at cost).

Please show all calculations using the working paper on the following Working Paper