
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Pharoah Corp had $1,120,000 of inventory at December 31, 2024, with purchases of $336,000 and sales of $784,000 in 2025.
Pharoah Corp lost all but $112,000 of inventories due to a hurricane in 2025. Using the gross profit method, calculate ending
inventory independently using the following assumptions:
1. Pharoah's gross margin was 30%
2. Pharoah mark up on cost was 20%
3. Pharoah's cost of sales percentage was 60%
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