Martinez 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) $ 81,100 Sales revenue $418,600 Purchases 286,900 Sales returns 21,200 Purchase returns 27,700 Gross profit % based on net selling price 38 %
Merchandise with a selling price of $30,500 remained undamaged after the fire, and damaged merchandise has a net realizable value of $7,500. The company does not carry fire insurance on its inventory.
1. Compute the amount of inventory fire loss. (Do not use the retail inventory method.)
Martinez 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) | $ 81,100 | Sales revenue | $418,600 | ||||
| Purchases | 286,900 | Sales returns | 21,200 | ||||
| Purchase returns | 27,700 | Gross profit % based on net selling price | 38 | % |
Merchandise with a selling price of $30,500 remained undamaged after the fire, and damaged merchandise has a net realizable value of $7,500. The company does not carry fire insurance on its inventory.
1. Compute the amount of inventory fire loss. (Do not use the retail inventory method.)
Related questions
Swifty Company lost most of its inventory in a fire in December just before the year-end physical inventory was taken. The corporationâs books disclosed the following.
| Beginning inventory | $156,000 | Sales revenue | $621,700 | ||||
| Purchases for the year | 380,100 | Sales returns | 23,800 | ||||
| Purchase returns | 30,100 | Rate of gross profit on net sales | 40 | % |
Merchandise with a selling price of $22,800 remained undamaged after the fire. Damaged merchandise with an original selling price of $16,000 had a net realizable value of $5,200.
Compute the amount of the loss as a result of the fire, assuming that the corporation had no insurance coverage
Amount of the loss__________
