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    D. The inventory of Snider Company was destroyed by fire on April 1. From an examination of the accounting records, the following data for the first three months of the year are obtained:

    Sales $225,000
    Sales Returns and Allowances 5,000
    Purchases 90,000
    Freight-In 3,500
    Purchase Returns and Allowances 4,000

    Required:
    Determine the merchandise lost by fire, assuming a beginning inventory of $60,000 and a gross profit rate of 40% on net sales.

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    Solution Summary

    The inventory of Snider Company was destroyed by fire on April 1. From an examination of the accounting records, the following data for the first three months of the year are obtained:

    $2.49

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