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Forum Gross Profit

The store had $48,000 in inventory on January 1st. Purchases were $46,000 and sales were $90,000 in January. In February, a fire destroyed most of the remaining inventory except for $5,000 worth that was undamaged. To calculate the fire loss, the gross profit rate of 25% is applied to the $5,000 of undamaged inventory to determine its cost. The difference between the starting inventory and this cost gives the fire loss amount.

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539 views

Forum Gross Profit

The store had $48,000 in inventory on January 1st. Purchases were $46,000 and sales were $90,000 in January. In February, a fire destroyed most of the remaining inventory except for $5,000 worth that was undamaged. To calculate the fire loss, the gross profit rate of 25% is applied to the $5,000 of undamaged inventory to determine its cost. The difference between the starting inventory and this cost gives the fire loss amount.

Uploaded by

dinda fauzia
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
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On January 1, a store had inventory of $48,000.

January purchases were $46,000 and January sales were $90,0


February 1 a fire destroyed most of the inventory. The rate of gross profit was 25% of cost. Merchandise with a
of $5,000 remained undamaged after the fire. Compute the amount of the fire loss.

Inventory $ 48,000.00 Merchandise selling price $ 5,000.00


Purchases $ 46,000.00 Rate gross profit 25% of cost
Good availables (at cost) $ 94,000.00
Sales $ 90,000.00
Approximate inventory $ 4,000.00

Gross profit $ 1,000.00


January sales were $90,000. On
cost. Merchandise with a selling price

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