Sheridan Music Company sells three principal types of musical instruments, with varying percentages of gross profit on cost. Harps Violins Cellos Gross profit percentage 30% 35% 40% On May 9, 2020 a fire destroyed Sheridan's office and the warehouse in which it stored the instruments. To file a report of loss for insurance purposes, the company must know what the inventories were immediately preceding the fire. Unfortunately Sheridan Music Company did not maintain any perpetual inventory records. A general ledger was kept and computer records related to the ledger were backed up to the cloud nightly. You were able to ascertain the following from the general ledger. Harps Violins Cellos Inventory, Jan. 1, 2020 $220,000 $132,000 $165,000 Purchases to May 9, 2020 165,000 55,000 82,500 Sales Revenue to May 9, 2020 321,750 163,350 261,800 Submit your estimate of the inventory amounts immediately preceding the fire.

Sheridan Music Company sells three principal types of musical instruments, with varying percentages of gross profit on cost. Harps Violins Cellos Gross profit percentage 30% 35% 40% On May 9, 2020 a fire destroyed Sheridan's office and the warehouse in which it stored the instruments. To file a report of loss for insurance purposes, the company must know what the inventories were immediately preceding the fire. Unfortunately Sheridan Music Company did not maintain any perpetual inventory records. A general ledger was kept and computer records related to the ledger were backed up to the cloud nightly. You were able to ascertain the following from the general ledger. Harps Violins Cellos Inventory, Jan. 1, 2020 $220,000 $132,000 $165,000 Purchases to May 9, 2020 165,000 55,000 82,500 Sales Revenue to May 9, 2020 321,750 163,350 261,800 Submit your estimate of the inventory amounts immediately preceding the fire.

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Description: Sheridan Music Company sells three principal types of musical instruments, with varying percentages of gross profit on cost.HarpsViolinsCellosGross profit percentage30%35%40%On May 9, 2020 a fire destroyed Sheridan's office and the warehouse in whic

Century 21 Accounting General Journal

11th Edition

ISBN:9781337680059

Author:Gilbertson

Publisher:Gilbertson

Chapter20: Accounting For Inventory

Section: Chapter Questions

Problem 1CP

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Ivanhoe Music Company sells three principal types of musical instruments, with varying percentages of gross profit on cost. Harps Violins Cellos Gross profit percentage 30% 35% 40% On May 9, 2020 a fire destroyed Ivanhoe's office and the warehouse in which it stored the instruments. To file a report of loss for insurance purposes, the company must know what the inventories were immediately preceding the fire. Unfortunately Ivanhoe Music Company did not maintain any perpetual inventory records. A general ledger was kept and computer records related to the ledger were backed up to the cloud nightly. You were able to ascertain the following from the general ledger. Harps Violins Cellos Inventory, Jan. 1, 2020 $208,000 $124,800 $156,000 Purchases to May 9, 2020 156,000 52,000 78,000 Sales Revenue to May 9, 202O 304,200 154,440 247,520 Submit your estimate of the inventory amounts immediately preceding the fire. Harps Violins Cellos Inventory $ $
Carla Vista Music Company sells three principal types of musical instruments, with varying percentages of gross profit on cost. Harps Violins Cellos Gross profit percentage 30% 35% 40% On May 9, 2020 a fire destroyed Carla Vista's office and the warehouse in which it stored the instruments. To file a report of loss for insurance purposes, the company must know what the inventories were immediately preceding the fire. Unfortunately Carla Vista Music Company did not maintain any perpetual inventory records. A general ledger was kept and computer records related to the ledger were backed up to the cloud nightly. You were able to ascertain the following from the general ledger. Harps Violins Cellos Inventory, Jan. 1, 2020 $180,000 $108,000 $135,000 Purchases to May 9, 2020 135,000 45,000 67,500 Sales Revenue to May 9, 2020 263,250 133,650 214,200 Submit your estimate of the inventory amounts immediately preceding the fire. Harps Violins Cellos Inventory $ $ $
Late on the night of August 30, 2021, an arsonist destroyed the FAITHFUL Inc's warehouse which was full of inventory. The accounting records were stored in another facility and not destroyed in the fire. The company is in the process of filing a claim with its insurance company for the inventory loss due to the fire. Beginning inventory P350,500 Purchases through August 30, 2021 470,250 Net sales revenue through August 30, 2021 745,200 The gross profit percent has historically been 40% of net sales revenue. Estimate the value of the inventory destroyed in the fire using the gross profit method.
Southern Distributors, Incorporated, supplies ice cream shops with various toppings for making sundaes. On November 17, 2024, a fire resulted in the loss of all of the toppings stored in one section of the warehouse. The company must provide its insurance company with an estimate of the amount of inventory lost. The following information is available from the company's accounting records: Inventory, January 1, 2024 Net purchases through November 17 Net sales through November 17 Historical gross profit ratio Ker Fruit Toppings Fruit Marshmallow Chocolate Toppings Toppings Toppings $ 29,000 $ 7,900 $ 3,900 195,000 Marshmallow Chocolate 245,000 15% Estimated cost of lost inventory 45,000 64,000 25% 1. Calculate the estimated cost of each of the toppings lost in the fire. 12,900 20,900 30%
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Nectarine Company lost most of its inventory in a fire in December, 2021, just before the year-end physical inventory was taken. The company’s books disclosed the following:Invy, 1/1/21 - 1,700,000Purchases - 3,900,000 Purchase return - 300,000Sales - 6,500,000 Sales returns - 240,000Merchandise costing P126,000 remain undamaged after the fire. Damaged merchandise with an original selling price of P150,000 had a net realizable value of P53,000. A partial comparative profit and loss for 2020 and 2019 also disclosed the following:2020: Sales - 5,000,000; CGS - 3,025,0002019: Sales - 5,600,000; CGS - 3,332,000Assuming that Nectarine Company had no insurance coverage, what is the amount of loss as a result of the fire?
Light Trading lost most of its inventory in a fire in December, 2023 just before the year-end physical inventory was taken. The company's books disclosed the following: Purchases P3,900,000 Sales 6,500,000 Purchase returns 300,000 Sales returns 240,000 Merchandise with selling price of P210,000 remain undamaged after the fire. Damaged merchandise with an original selling price of P150,000 had a net realizable value of P53,000. A partial comparative profit and loss for 2022 and 2021 also disclosed the following: 2022 2021 Sales P5,000,000 P5,600,000 Cost of goods sold: Inventory, Januar 1 P 945,000 P1,100,000 Purchase (net) 3,780,000…
1. On October 21, 2020, a fire destroyed the entire uninsured merchandise inventory of the Renan Merchandising Company. The following data are available: Inventory, January 1 P80,000; Markup percentage on cost 25%; Purchases, January 1 through October 21 P560,000; Sales, January 1 through October 21 P776,000.What is the approximate inventory loss as a result of the fire? choices: P19,200 P34,000 P58,000 P27,200 2. Daniel Company prepares monthly income statements. A physical inventory is taken only at year-end; hence, month-end inventories must be estimated. All sales are made on account. The rate of markup on cost is 50 percent. The following information relates to the month of August: Accounts receivable, August 1 P20,000; Accounts receivable, August 31 P30,000Collection of accounts receivable during August P50,000; Inventory, August 1 P36,000; Purchases of inventory during August P32,000. The estimated cost of the May 31 inventory is…
. Nectarine Company lost most of its inventory in a fire in December, 2021, just before the year- end physical inventory was taken. The company's books disclosed the following: Invy, 1/1/21 - 1,700,000 - 3,900,000 300,000 6,500,000 240,000 Purchases Purchase return Sales %3 Sales returns Merchandise costing P126,000 remain undamaged after the fire. Damaged merchandise with an original selling price of P150,000 had a net realizable value of P53,000. A partial comparative profit and loss for 2020 and 2019 also disclosed the following: 2020: Sales - 5,000,000; CGS - 3,025,000 2019: Sales - 5,600,000; CGS - 3,332,000 Assuming that Nectarine Company had no insurance coverage, what is the amount of loss as a result of the fire? *
On November 21, 2021, a fire at Hodge Company's warehouse caused severe damage to its entire inventory of Product Tex. Hodge estimates that all usable damaged goods can be sold for $22,000. The following information was available from the records of Hodge's periodic inventory system: Inventory, November 1 Net purchases from November 1, to the date of the fire Net sales from November 1, to the date of the fire $150,000 150,000 230,000 Based on recent history, Hodge's gross profit ratio on Product Tex is 35% of net sales. Required: Calculate the estimated loss on the inventory from the fire, using the gross profit method. ✓ Answer is complete but not entirely correct. Estimated loss from fire $ 153,200 ×
Wormold Industries suffered a fire in its warehouse on March 4, 2021. The warehouse was fullof finished goods, and after reviewing the damage, management determined that inventory,with a retail selling price of $90,000, was not damaged by the fire.For the period from January 1, 2021, to March 4, 2021, accounting records showed thefollowing: Purchases $650,000Purchase returns 16,000Sales revenue 955,000 The inventory balance on January 1, 2021, was $275,000, and the company has historicallyearned a gross profit percentage of 35%.Required: Use the gross profit method to determine the cost of inventory damaged by the fire.