Question
Sandhill Music Company sells three principal types of musical instruments, with varying percentages of gross profit on cost. Harps Violins Cellos Gross profit percentage 30%
Sandhill Music Company sells three principal types of musical instruments, with varying percentages of gross profit on cost.
Harps | Violins | Cellos | ||||
---|---|---|---|---|---|---|
Gross profit percentage | 30% | 35% | 40% |
On May 9, 2017 a fire destroyed Sandhills office and the warehouse in which it stored the instruments. To file a report of loss for insurance purposes, the company must know what the inventories were immediately preceding the fire. Unfortunately Sandhill Music Company did not maintain any perpetual inventory records. A general ledger was kept and computer records related to the ledger were backed up to the cloud nightly. You were able to ascertain the following from the general ledger.
Harps | Violins | Cellos | ||||
---|---|---|---|---|---|---|
Inventory, Jan. 1, 2017 | $ 184,000 | $ 110,400 | $ 138,000 | |||
Purchases to May 9, 2017 | 138,000 | 46,000 | 69,000 | |||
Sales Revenue to May 9, 2017 | 269,100 | 136,620 | 218,960 |
Submit your estimate of the inventory amounts immediately preceding the fire.
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