Assume Dollar Forest Store estimates its inventory by the gross margin method when preparing monthly financial statements (it uses the periodic method otherwise). For the past two years, the cost of goods purchased has averaged 62 percent of net sales. Assume further that the company's inventory records for its stores reveal the following data: $510,000 Inventory: June 1, 2023 Transactions during June: Purchases Sales Required Requirement 1. Estimate the June 30, 2023, inventory using the gross margin method. Cost of goods sold $4,880,000 $8,435,000 Estimated cost of ending inventory Requirement 2. Prepare the June Income statement through gross margin for Dollar Forest Store. Cost of goods sold Required 1. Estimate the June 30, 2023, inventory using the gross margin method. 2. Prepare the June income statement through gross margin for Dollar Forest Store. Print Done

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Assume Dollar Forest Store estimates its inventory by the gross margin method when preparing monthly financial statements (it uses the periodic method otherwise). For the past two years, the cost of goods purchased has averaged 62 percent of net sales. Assume further that
the company's inventory records for its stores reveal the following data:
$510,000
Inventory: June 1, 2023
Transactions during June:
Purchases
Sales
Required
Requirement 1. Estimate the June 30, 2023, inventory using the gross margin method.
Cost of goods sold
$4,880,000
$8,435,000
Estimated cost of ending inventory
Requirement 2. Prepare the June Income statement through gross margin for Dollar Forest Store.
Cost of goods sold
Required
1. Estimate the June 30, 2023, inventory using the gross margin method.
2. Prepare the June income statement through gross margin for Dollar Forest Store.
Print
Done
Transcribed Image Text:Assume Dollar Forest Store estimates its inventory by the gross margin method when preparing monthly financial statements (it uses the periodic method otherwise). For the past two years, the cost of goods purchased has averaged 62 percent of net sales. Assume further that the company's inventory records for its stores reveal the following data: $510,000 Inventory: June 1, 2023 Transactions during June: Purchases Sales Required Requirement 1. Estimate the June 30, 2023, inventory using the gross margin method. Cost of goods sold $4,880,000 $8,435,000 Estimated cost of ending inventory Requirement 2. Prepare the June Income statement through gross margin for Dollar Forest Store. Cost of goods sold Required 1. Estimate the June 30, 2023, inventory using the gross margin method. 2. Prepare the June income statement through gross margin for Dollar Forest Store. Print Done
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