The Bubba Company uses the gross profit method to estimate inventory and cost of goods sold for interim reporting purposes. The average gross profit rate is 25% of sales. The following data relate to the month of May: Inventory cost, May 1 $30,000 Purchases during the month at cost $80,400 Sales Sales returns $100,800 $3,600 Using the data above, what is the estimated ending inventory on May 31? A. $24,300 B. $25,200 C. $34,800 D. $37,500

The Bubba Company uses the gross profit method to estimate inventory and cost of goods sold for interim reporting purposes. The average gross profit rate is 25% of sales. The following data relate to the month of May: Inventory cost, May 1 $30,000 Purchases during the month at cost $80,400 Sales Sales returns $100,800 $3,600 Using the data above, what is the estimated ending inventory on May 31? A. $24,300 B. $25,200 C. $34,800 D. $37,500

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter7: Inventories: Cost Measurement And Flow Assumptions

Section: Chapter Questions

Problem 2RE: On January 1, Pope Enterprises inventory was 625,000. Pope made 950,000 of net purchases during the...

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