On June 13, Hagen Products Sustained a Warehouse Fire in Which

Short Answer

On June 13, Hagen Products sustained a warehouse fire in which all of the merchandise was destroyed. Company records indicate that at the time of the fire the net sales to date were $2,438,500. Hagen had a beginning inventory of $658,300 and net purchases were $1,562,850. They have maintained a gross margin of 35% on sales over the past three years. Use the gross margin method to estimate the inventory loss for the insurance claim.