P9-4B (L05) (Gross Profit Method) Higgs Company lost most of its inventory in a fire in November just before the year-end physical inventory was taken. Corporate records disclose the following. Sales Inventory (beginning) Purchases $186,000 667,000 $863,000 64,000 25% Purchase returns Sales returns Gross profit % based on net selling price 46,000 Merchandise with a selling price of $65,000 remained undamaged after the fire, and damaged merchandise has a salvage value of $26,400. The company does not carry fire insurance on its inventory. Instructions Prepare a formal labeled schedule computing the fire loss incurred. (Do not use the retail inventory method.)

P9-4B (L05) (Gross Profit Method) Higgs Company lost most of its inventory in a fire in November just before the year-end physical inventory was taken. Corporate records disclose the following. Sales Inventory (beginning) Purchases $186,000 667,000 $863,000 64,000 25% Purchase returns Sales returns Gross profit % based on net selling price 46,000 Merchandise with a selling price of $65,000 remained undamaged after the fire, and damaged merchandise has a salvage value of $26,400. The company does not carry fire insurance on its inventory. Instructions Prepare a formal labeled schedule computing the fire loss incurred. (Do not use the retail inventory method.)

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Description: P9-4B (L05) (Gross Profit Method) Higgs Company lost most of its inventory in a fire in November just before the year-endphysical inventory was taken. Corporate records disclose the following.SalesInventory (beginning)PurchasesPurchase returns$186,0

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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