Alanood Company wants to prepare interim financial statements for the first quarter of 2014 but would like to avoid making a physical count of inventory. During the last five years, the company's gross profit rate has averaged 36%. The following information for the year's first quarter is available from its records:
January 1 beginning inventory $300,260
Purchases 945,200
Purchase returns 1 3,050
Transportation-in 6,900
Sales 1,191,150
Sales returns 9,450
Required:
Use the gross profit method to prepare an estimate of the company's March 31 inventory.