a VERS?ON .BACK Multiple Choice Question 149 T Nelson Company prepares monthly f

Question

a VERS?ON .BACK Multiple Choice Question 149 T Nelson Company prepares monthly financial statements and uses the gross profit method to estimate ending inventories. Historically, the company has had a 40% gross profit rate. During June, net sales amounted to $180,000; the beginning inventory on June 1 was $54,000; and the cost of goods purchased during June amounted to $90,000. The estimated cost of TB Nelson Company's inventory on June 30 is $21,600 $36,000 $72,000 $126,000. K TO TEXT Question Attempts: 0 of 1 used SAVE FOR LATER SUBMIT ANSWER 6 7 9 5

Explanation / Answer

b. $36,000

The estimated cost of TB Nelson Company's inventory on June 30 is:

= $54,000 + $90,000 - ($180,000 × .60)

= $36,000

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