The solution to Gross Profit Method
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The following information is available for October for Horton Company.
Beginning inventory $100,000
Net purchases 300,000
Net sales 600,000
Percentage markup on cost 66.67%
A fire destroyed Horton's October 31 inventory, leaving undamaged inventory with a cost of $6,000. Using the gross profit method, what is the estimated ending inventory destroyed by fire?
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Solution Summary
The solution explains how to estimate the ending inventory using the gross profit method.
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The gross profit is given on cost price. We need to convert to selling price
Gross Profit based on ...
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