Royal Gorge Company uses the gross profit method to estimate ending inventory and cost of goods sold when preparing monthly financial statements required by its bank. Inventory on hand at the end of October was $58,600. The following information for the month of November was available from company records:

Purchases	$	111,000
Freight-in		3,100
Sales		185,000
Sales returns		5,500
Purchases returns		4,500

In addition, the controller is aware of $8,500 of inventory that was stolen during November from one of the company