On January 1, The Parts Store had a $370.000 inventory at cost. During the first quarter of the year, It purchased $1,510,000 of merchandise, returned $19,100, and pald freight charges on purchased merchandise totalling $33,600. During the past several years, the store's gross profit on sales has averaged 30%. Under the assumption the store had $1,920,000 of sales during the first quarter of the year, use the gross profit method to estimate its Inventory at the end of the first quarter.

On January 1, The Parts Store had a $370.000 inventory at cost. During the first quarter of the year, It purchased $1,510,000 of merchandise, returned $19,100, and pald freight charges on purchased merchandise totalling $33,600. During the past several years, the store's gross profit on sales has averaged 30%. Under the assumption the store had $1,920,000 of sales during the first quarter of the year, use the gross profit method to estimate its Inventory at the end of the first quarter.

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

Chapter5: The Income Statement And The Statement Of Cash Flows

Section: Chapter Questions

Problem 3RE: Shaquille Corporation began the current year with inventory of 50,000. During the year, its...

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