On September 5, 20x4, a fire damaged the warehouse of Texas company. All inventory items and many accounting records stored in the warehouse was destroyed. However, a portion of the inventory could be sold for scrap. The company's backup files provide the following information: Inventory, January 1 P 750,000 Cash sales, January 1-September 5 445,000 Purchases, January 1-September 5 2,770,000 Collection of accounts receivable, January 1-September 5 4,230,000 Accounts Receivable, January 1 350,000 Accounts Receivable, September 5 530,000 Salvage value of Inventory 15,000 Gross profit ratio 32% What is the estimated inventory fire loss?

On September 5, 20x4, a fire damaged the warehouse of Texas company. All inventory items and many accounting records stored in the warehouse was destroyed. However, a portion of the inventory could be sold for scrap. The company's backup files provide the following information: Inventory, January 1 P 750,000 Cash sales, January 1-September 5 445,000 Purchases, January 1-September 5 2,770,000 Collection of accounts receivable, January 1-September 5 4,230,000 Accounts Receivable, January 1 350,000 Accounts Receivable, September 5 530,000 Salvage value of Inventory 15,000 Gross profit ratio 32% What is the estimated inventory fire loss?

Century 21 Accounting Multicolumn Journal

11th Edition

ISBN:9781337679503

Author:Gilbertson

Publisher:Gilbertson

Chapter20: Accounting For Inventory

Section: Chapter Questions

Problem 1CP

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On October 1, 20x1, the warehouse of ABC Co. and all the inventories contained therein were damaged by flood. Off-site back up of data base shows the following information: Inventory, Jan. 1 10,000 Accounts payable, Jan. 1 3,000 Accounts payable, Sept. 30 2,000 Payments to suppliers 50,000 Freight-in 500 Purchase returns 500 Sales from Jan. to Sept. 80,000 Sales returns 5,000 Sales discounts 2,000 Gross profit rate based on sales 30% Additional information: Goods in…
6. On June 30, 20X3, a storm damaged a warehouse of ABC Company. The entire inventory and many accounting records stored in the warehouse were completely destroyed. Although the inventory was not insured, a portion could be sold for scrap. Through the use of microfilmed records, the following data are assembled. Inventory, January 1 7,500,000 Purchases, January 1 – June 30 31,500,000 Cash sales, January 1 – June 30 5,000,000 Collection of accounts receivable, January 1 – June 30 45,000,000 Accounts receivable, January 1 3,000,000 Accounts receivable, June 30 4,000,000 Salvage value of inventory 400,000 Gross profit percentage on sales 40% The inventory loss as a result of the storm should be reported at a.8,400,000 b.8,000,000 c.9,000,000 d.8,600,000
On December 31, 2021, a typhoon damaged a warehouse of Iceman Corporation. The entire company and many accounting records stored in the warehouse were completely destroyed. Although the Inventory was not Insured, a portion could be sold for scrap. Through the use of microfilmed records, the following data were gathered: Inventory, January 1, P450,000; Purchases, P2,160,000; Cash sales, P273,600; Amount of account receivable collected, P2,520,000; Accounts receivable-January 1; P210,000; Accounts written off, P9,600; Recovery of accounts written-off P3,600; Accounts receivable-December 31, P342,000; Sales returns, P36,000: Sales discounts, P14,400; Purchase returns, P60,000; Purchase discounts, P12,000; Freight in, P21,600; Salvage value of damaged Inventory, P90,000 while an undamaged Inventory that were marked to sell at P150,000 were recovered. Gross profit percentage on sales, 32%. How much is the value of Inventory loss?
A fire destroyed the warehouse of Reed Enterprises, on August 31, 20Y1. The books and records of Reed showed the following information on that date. Merchandise Inventory. Jan. 1, 20Y1 $600,000 Purchases to date 990,000 Freight - In 30,000 Sales to date $2,400,000 The gross profit ratio has averaged 60 % of sales for the past six years.Required:Use the gross profit method to estimate the cost of inventory destroyed by fire. Group of answer choices $660,000 $1,590,000 $1,620,000 $960,000
The Star Company's inventory was partially destroyed on July 4, 2004, when its warehouse caught on fire early in the morning. Inventory that had a cost of $8,500 was saved. The accounting records, which were located in a fireproof vault, contained the following information. Sales (1/1/04 through 7/3/04) $225,000 Purchases (1/1704 through 7/3/04) 180,000 Inventory (1/1/04) 45,000 Gross Profit Ratio 25% of cost Using the gross profit method, what is the estimated cost of the inventory destroyed by the fire? a. $17,500b. $25,000c. $30,000d. $36,500
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Inventory, January 1	P 750,000
Cash sales, January 1-September 5	445,000
Purchases, January 1-September 5	2,770,000
Collection of accounts receivable, January 1-September 5	4,230,000
Accounts Receivable, January 1	350,000
Accounts Receivable, September 5	530,000
Salvage value of Inventory	15,000
Gross profit ratio	32%