On February 26, a hurricane destroyed the entire inventory stored in a warehouse owned by the Rockford Corporation. The following information is available from the records of the company’s periodic inventory system: beginning inventory, $220,000; purchases and net sales from the beginning of the year through February 26, $400,000 and $600,000, respectively; gross profit ratio, 30%. Estimate the cost of the inventory destroyed by the hurricane using the gross profit method.

Q: Coronado Inc. took a physical inventory at the end of the year and determined that $790000 of goods…

A: In case of F.O.B shipping, the ownership relating to goods is transferred to the purchaser (buyer)…

Q: On February 26, a hurricane destroyed the entire inventory stored in a warehouse owned by the…

A: Given,  Gp ratio = 40% = 100 * Gross profit / Net sales Purchase = 420000 Net sales = 620000…

Q: Klassen Furniture Inc. paid $3,000 for inventory on September 26. By December 31, Klassen determined…

A: Lets understand the basics.As per IAS 2 "Inventory", inventory should be valued at lower of cost or…

Q: On February 26, a hurricane destroyed the entire inventory stored in a warehouse owned by the…

A: Net purchases and beginning inventories are included in the cost of commodities that are offered for…

Q: Coronado Company took a physical inventory on December 31 and determined that goods costing $199,600…

A: The inventory valuation method used to evaluate the closing inventory and cost of goods sold on the…

Q: Lily Company needs to determine the amount of inventory in its warehouse at the time that an…

A: Cost of goods available for sale = Beginning inventory + purchases Cost of goods sold = Sales -…

Q: Compute the amount of the loss as a result of the fire, assuming that the corporation had no…

A: The inventory that is sold or distributed and that has been purchased as finished goods or requires…

Q: Grouper Company lost most of its inventory in a fire in December just before the year-end physical…

A: Lets understand the basics. When inventory gets damaged due to fire then loss due to fire needs to…

Q: SM’s management has asked you to provide the following information: 1. Number of units on hand,…

A: Since you have posted a question with multiple sub-parts, we will solve the first three sub-parts…

Q: corporation's books disclosed the following. Beginning inventory $ 183,500 Sales revenue $683,600…

A: solution : net purchase     =358400 – 30000                              =328400 Net sales…

Q: corporation's books disclosed the following. Beginning inventory Purchases for the year Purchase…

A: The cost of goods sold includes the cost of goods that are sold during the period. The ending…

Q: Marigold Inc.’s April 30 inventory was destroyed by the explosion of an underground oil tank.…

A: Gross Profit is profit earned on selling the goods, which is calculated by deducting Cost of goods…

Q: Required: 1. Calculate the estimated inventory at the end of August, assuming a gross profit ratio…

A: 1.  Beginning Inventory           118,000  Add: Net purchases (210000-3400)           206,600…

Q: Sunland Legler requires an estimate of the cost of goods lost by fire on March 9. Merchandise on…

A: Solution: Introduction: Inventory means goods are available for sale and raw materials used in the…

Q: Henderson Company uses the gross profit method to estimate ending inventory and cost of goods sold…

A: The cost of goods sold includes the cost of goods that are sold during the period. The gross profit…

Q: Marigold Corporation's April 30 inventory was destroyed by fire. January 1 inventory was $164,900,…

A: The inventory valuation method used to evaluate the closing inventory and cost of goods sold. In…

Q: Purchases Freight-in Sales Sales returns Purchases returns $114,000 3,400 200,000 9,000 6,000

A: Inventory, based on its intended use and where it is in the manufacturing or distribution process.…

Q: average cost inventory valuation system. Yakal makes a physical count at the end of each month…

A: Given, Ending inventory units is 60,000 Cost of units available is ₱1,452,100 Cost of goods sold is…

Q: Martinez Corporation’s retail store and warehouse closed for an entire weekend while the year-end…

A: Gross profit = Sales * 35% = $2,752,000 x 35% = $963,200

Q: Johnnie Walker Company provided the following data at year-end: Items counted in the warehouse…

A: Inventory refers to the goods which is not yet sold by the business but their goal is to sell these…

Q: Rahul

A: To compute the cost of goods destroyed, just please follow the following steps: Step 1: Calculate…

Q: What amount should Stallman report as its December 31, intentory?

A:

Q: e Westmoreland Corporation uses a periodic system for its inventory. The company starts the current…

A: Cost is the expenses which have been incurred for production, marketing and selling a product, from…

Q: Bedrock Company reported a December 31 ending inventory balance of $416,500. The following…

A: It is important to understand the items that should be included in inventory at the end of an…

Q: Crane Legler requires an estimate of the cost of goods lost by fire on March 9. Merchandise on hand…

A: Cost of goods sold means the cost of goods which has been actually sold out during the year. When we…

Q: palace made sales of merchandise inventory of $10,000 in 20Y5. The cost of sales for the year was…

A: Multi-step income statement shows the net income under various steps.

Q: Concord Inc. took a physical inventory at the end of the year and determined that $832000 of goods…

A: FOB (Free on board) destination means the ownership of the goods will be transferred to buyer only…

Q: On March 1, AYE Merchandising had an inventory of P560,000 in its retail store. Purchases made in…

A: Loss by Fire - Loss by fire or any other natural calamities is an extraordinary loss for the…

Q: Apply the COGS equation used on the bottom of page 6-3 of the VLN to the following data set to…

A: The cost of goods sold is calculated as difference between cost of goods available for sale and…

Q: On 1st Nov 2020, a business had inventory of $380,000. During the month,  sales totalled $650,000…

A: Data given: Opening inventory = $380,000 Purchase during the month= $480,000 Sales during the month…

Q: Beginning inventory - 18,850.00 Payable, beginning - 7,500.00 Payable, November 30 - 1,980.00…

A: Stock loss by Fire refers to Value of Stock in Godown at the time of fire less Stock recovered from…

Q: Henderson Company uses the gross profit method to estimate ending inventory and cost of goods sold…

A: The cost of goods sold includes the cost of goods that are sold during the period. The gross profit…

Q: Cullumber Legler requires an estimate of the cost of goods lost by fire on March 9. Merchandise on…

A: 1. Cost of Goods Destroyed - Cost of Goods Destroyed by fire is the goods destroyed and reduced from…

Q: Wildhorse Company took a physical inventory on December 31 and determined that goods costing…

A: In case of sale of 37000 control will transfer when goods reach to destination ,but they are in…

Q: Sheridan Legler requires an estimate of the cost of goods lost by fire on March 9. Merchandise on…

A: Cost of goods sold:Cost of goods sold (COGS) refers to the direct costs of producing the goods sold…

Q: Crane Company took a physical inventory on December 31 and determined that goods costing $180,000…

A: Lets understand the basics.Inventory is generally calculated at a regular interval. It can be…

Q: Compute the amount of the loss as a result of the fire,

A: Amount of loss = Ending inventory - Undamaged inventory - Net realizable value of damaged…

Q: Riverbed Inc.’s April 30 inventory was destroyed by the explosion of an underground oil tank.…

A: The ending inventory is the inventory that is left unsold in the business.

Q: On 1st Jan 2006, a business had inventory of $19,000. During the month, sales totalled $32,500 and…

A: Here, we need to use the retail gross profit method to assess thr loss. This method is used by the…

Q: Blue Corporation's April 30 inventory was destroyed by fire. January 1 inventory was $155,000, and…

A: Gross profit means where the cost of goods sold is deducted from net sales. Net profit means where…

Inventory Valuation

Before discussing the topic inventory valuation let’s discuss the meaning of inventory. In accounting, inventory is also known as stock. Inventory means all the finished goods, materials, merchandise that a business holds for the purpose of selling it in the market with the motive of earning profit.