I am lost on this and I need your help... Please put in excel. Thank you.
Eastman Company lost most of its inventory in a fire in December just before the year-end physical inventory was taken. Corporate records disclose the following.
Inventory (beginning) $80,000
Purchase returns 28,000
Sales returns 21,000
Gross profit % based on net selling price 35%
Merchandise with a selling price of $30,000 remained undamaged after the fire, and damaged merchandise has a salvage value of $8,150. The company does not carry fire insurance on its inventory.
Prepare a formal labeled schedule computing the fire loss incurred. (Do not use the retail inventory method.)
The solution explains how to calculate the inventory lost in fire using the gross profit method