Callahan Computers Stores Its Inventory in a Warehouse That Burned

Multiple Choice

Callahan Computers stores its inventory in a warehouse that burned to the ground in late November,2012.Their sales office was at a different location.In order to file a claim with their insurance,the owners ask you to estimate the inventory in the warehouse.The following information is available: $$\begin{array} { | l | r |} \hline \text { Beginning inventory } & \$ 375,500 \\\hline \text { Purchases through November 30 } & 470,250 \\\hline \text { Net sales revenue through November 31 } & 793,000 \\\hline\end{array}$$ The company's gross profit has historically been 40% of Net sales revenue.Estimate the value of the inventory destroyed in the fire using the gross profit method.

A) $369,950
B) $528,550
C) $410,000
D) $388,450