
College Accounting, Chapters 1-27
23rd Edition
ISBN: 9781337794756
Author: HEINTZ, James A.
Publisher: Cengage Learning,
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Accounting Problem 2.3

Transcribed Image Text:Question:
Deluxe Auto Parts holds inventory all over the world. Assume that the records for one
auto part show the following:
Beginning inventory $220,000
Net purchases
Net sales
Gross profit rate
800,000
1,100,000
45%
Suppose this inventory, stored in the United States, was lost in a fire.
Estimate the amount of the loss to Deluxe Auto Parts. Use the gross profit method.
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