SarasotaCompany uses the gross profit method to estimate inventory for monthly reporting purposes. Presented below is information for the month of May.

Inventory, May 1$146,400Purchases (gross)581,500Freight-in27,800Sales revenue917,100Sales returns69,300Purchase discounts12,200

part 1

Compute the estimated inventory at May 31, assuming that the gross profit is 25% of net sales.

The estimated inventory at May 31

part 2

Compute the estimated inventory at May 31, assuming that the gross profit is 25% of cost