10. A company lost all but S50 of its inventory in a fire on Feb. 22,2017. The c

Question

10. A company lost all but S50 of its inventory in a fire on Feb. 22,2017. The company's financial records are listed below: 2015 10,000 6,500 3,500 2,000 1,500 2016 12,300 7995 4,305 Net Sales COGS Gross Profit ating Ex Net Income 1,805 For 2017 the company's records showed beginning inventory of S350, purchases of S500 and purchase returns of S90 Net sales for the first part of the year totaled $1,000 Determine the amount of inventory destroyed in the fire. (You must first calculate the company 's historical gross profit percentage.) A. $240 B. $360 D. $150 E. S110

Explanation / Answer

Answer

c ) 60

beginning inventory 350 Add: Purchases 500 Less: Purchases returns -90 Less: Cost of goods sold -650 (1000*65%) Inventory available at the date of fire 110 Less: Inventory recovered 50 Inventory destroyed 60

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