Using the Retail Inventory method, determine the amount of World Gamers Ltd claim for the inventory loss by calculating: (a) the cost of goods available for sale (b) the estimated cost of sales (c) the estimated inventory lost by fire

Using the Retail Inventory method, determine the amount of World Gamers Ltd claim for the inventory loss by calculating: (a) the cost of goods available for sale (b) the estimated cost of sales (c) the estimated inventory lost by fire

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

Chapter8: Inventories: Special Valuation Issues

Section: Chapter Questions

Problem 10E: Gross Profit Method: Estimation of Theft Loss You are requested by a client on September 28 to...

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A substantial portion of inventory owned by Prentiss Sporting Goods was recently destroyed when the roof collapsed during a rainstorm. Prentiss also lost some of its accounting records. Prentiss must estimate the loss from the storm for insurance reporting and financial statement purposes. Prentiss uses the periodic inventory system. The following accounting information was recovered from the damaged records. Beginning inventory Purchases to date of storm $196,000 398,000 600,800 Sales to date of storm The value of undamaged inventory counted was $102,676. Historically, Prentiss' gross margin percentage has been approximately 22 percent of sales. Required Estimate the following: a. Gross margin in dollars. b. Cost of goods sold in dollars. c. Ending inventory. d. Amount of lost inventory. a. Gross margin b. Cost of goods sold c. Estimated ending inventory d. Inventory lost
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Sarasota Lumber Company handles three principal lines of merchandise with these varying rates of gross profit on cost. Lumber Millwork Hardware and fittings 25% 30% 40% On August 18, a fire destroyed the office, lumber shed, and a considerable portion of the lumber stacked in the yard. To file a report of loss for insurance purposes, the company must know what the inventories were immediately preceding the fire. No detail or perpetual inventory records of any kind were maintained. The only pertinent information you are able to obtain are the following facts from the general ledger, which was kept in a fireproof vault and thus escaped destruction. Inventory $ Inventory, Jan. 1, 2025 Purchases to Aug. 18, 2025 Sales revenue to Aug. 18, 2025 Lumber Lumber $247,600 1,521,600 2,111,100 Millwork $88,900 372,700 483,600 Hardware $45,700 Submit your estimate of the inventory amounts immediately preceding the fire. (Round ratios for computational purposes to 5 decimal places, e.g. 78.74265% and…
A substantlal portlon of Inventory owned by Prentiss Sporting Goods was recently destroyed when the roof collapsed during a ralnstorm. Prentiss also lost some of Its accounting records. Prentiss must estimate the loss from the storm for Insurance reporting and financial statement purposes. Prentiss uses the perlodic Inventory system. The following accounting information was recovered from the damaged records. Beginning inventory $196, eee 398, e00 Purchases to date of storm Sales to date of storm бее, вее The value of undamaged Inventory counted was $102,676. Hıstorically, Prentiss' gross margin percentage has been approximately 22 percent of sales. Required Estimate the following: a. Gross margin in dollars. b. Cost of goods sold in dollars. c. Ending Inventory. d. Amount of lost Inventory. a. Gross margin b. Cost of goods sold C. Estimated ending inventory d. Inventory lost
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Problem 8 - Revier Company's records were destroyed by fire. The controller was able in ascertain that sales for the nine month period ending September 30 were P1,250,000. The company's suppliers indicated that merchandise costing P500,000 was delivered for the period. The company's statement indicated that the ending inventory for the previous accounting period was P260,000. The company was reimbursed by its insurance company for P200,000 worth of inventory destroyed by the fire. Insurance companies pay 80% of the cost for casualty of this nature. There were no other inventories on hand. REUQIRED: 1.Estimate the cost of goods for this period 2.Amount of loss to the company
A fire completely destroyed all the inventory of Glisan Lumber Yard on August 5, 20--. Fortunately, the accounting records were not destroyed in the fire. The following information is provided by Glisan Lumber Yard for the time period January 1 through August 5: Beginning inventory, January 1, 20-- $100,000 Net purchases, January 1 through August 5 420,000 Net sales, January 1 through August 5 732,000 Normal gross profit as a percentage of sales 40% Required: Estimate the amount of merchandise inventory destroyed in the fire on August 5 using the gross profit method.
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A flood destroyed a company's warehouse contents on September 12. The following information was the only information that was salvaged: 1. Inventory, beginning: $28,200 2. Purchases for the period: $17,200 3. Sales for the period: $55,200 4. Sales returns for the period: $720 The company's average gross profit ratio is 37%. What is the estimated cost of the lost inventory using the gross profit method? Multiple Choice $11,077.60. $25,242.40. $28,602.00. $45,400.00. $44,400.00.
3. On August 31, a flood at Lordgin Company's only warehouse caused severe damage to its entire inventory. Based on recent history, Lordgin has a gross profit of 25 percent of net sales. The following information is available from Lordgin's records for the eight months ended August 31: Inventory, January 1 P520,000; Net Purchases 4,060,000; Net Sales 5,200,000. A physical inventory disclosed usable damaged goods which Lordgin estimates can be sold for P70,000. Using the gross profit method, the estimated cost of goods sold for the eight months ended August 31 should be choices: P4,200,000. P3,830,000 P3,900,000 P680,000
On April 15 of the current year, a fire destroyed the entire uninsured inventory of a retail store. The following data are available: Sales, January 1 through April 15 $573000 Inventory, January 1 91000 Purchases, January 1 through April 15 477500 20% Markup on cost The amount of the inventory loss is estimated to be • $91000. O $109200. O $95500. O $45500.