Test: FMGT 1115 - MID- TERM 2 SUMMER 2022 Question 10 of 16 This test: 80 point(s) possible This Submit test question: 10 point(s) possible Rainbow Company began May with inventory of $230,000. The business made net purchases of $610,000 and had net sales of $880,000 before a fire destroyed the company's inventory. For the past several years, Rainbow Company's gross margin on sales has been 38 percent. Required 1. Estimate the cost of the inventory destroyed by the fire. 2. Identify another reason owners and managers use the gross margin method to estimate inventory on a regular basis. Requirement 1. Estimate the cost of the inventory destroyed by the fire. Cost of goods available for sale Estimated cost of goods sold: Less: Estimated ending inventory Requirement 2. Identify another reason owners and managers use the gross margin method to estimate inventory on a regular basis. Time Remaining: 00:39:24 Next III Test: FMGT 1115 - MID- TERM 2 SUMMER 2022 Question 10 of 16 This test: 80 point(s) possible This question: 10 point(s) possible Submit test Rainbow Company began May with inventory of $230,000. The business made net purchases of $610,000 and had net sales of $880,000 before a fire destroyed the company's inventory. For the past several years, Rainbow Company's gross margin on sales has been 38 percent. Required 1. Estimate the cost of the inventory destroyed by the fire. 2. Identify another reason owners and managers use the gross margin method to estimate inventory on a regular basis. Cost of goods available for sale Estimated cost of goods sold: Less: Estimated ending inventory Requirement 2. Identify another reason owners and managers use the gross margin method to estimate inventory on a regular basis. Another reason owners and managers use the gross margin method to estimate inventory cost on a regular basis is