Solved

A Fire Completely Destroyed the Inventory Housed in a Warehouse

Question 93

Multiple Choice

A fire completely destroyed the inventory housed in a warehouse in August.Reconstructed data follows: Sales to date of fire $340,000Gross margin as a percent of cost 60%Gross purchases to date of fire 200,000Beginning inventory 30,000Purchases returns and allowances to date of fire10,000 Freight-in4,000 Sales returns25,000\begin{array} { l } \text {Sales to date of fire }&\$340,000\\ \text {Gross margin as a percent of cost }&60\%\\ \text {Gross purchases to date of fire }&200,000\\ \text {Beginning inventory }&30,000\\ \text {Purchases returns and allowances to date of fire}&10,000\\ \text { Freight-in}&4,000\\ \text { Sales returns}&25,000\\\end{array}
Compute the loss of inventory due to the fire.


A) $98,000
B) $54,667
C) $27,125
D) $34,456

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions