Question : 11) Blue Moon Company has the following data for the : 1230191

 

11) Blue Moon Company has the following data for the year:

 

Beginning inventory

  $80,000

Net purchases

$115,000

Net sales revenue

$200,000

Normal gross profit percentage

45%

 

What is the estimated ending inventory?

A) $65,000

B) $80,000

C) $85,000

D) $105,000

 

12) The following data are for Tina’s Candy Store for January:

 

Beginning inventory

  $215,000

Net sales revenue

$440,000

Net purchases

  $605,000

Normal gross profit rate

40%

 

What is the company’s estimated cost of goods sold for the month?

A) $165,000

B) $176,000

C) $225,000

D) $264,000

 

13) The following data are for Tina’s Candy Store for January:

 

Beginning inventory

  $215,000

Net sales revenue

$440,000

Net purchases

  $605,000

Normal gross profit rate

40%

 

What is the company’s estimated ending inventory for the month?

A) $105,000

B) $156,000

C) $210,000

D) $244,000

14) Wendy Industries has the following information available for March:

 

Total sales

$810,000

Purchases

$440,000

Beginning inventory

$212,000

Ending inventory

??

Cost of goods sold

60% of sales

 

Calculate Wendy’s ending inventory.

Answer: 

Beginning inventory

$212,000

Plus purchases

 440,000

Equals goods available for sale

652,000

Less ending inventory

652,000 – 486,000

166,000

Equals cost of goods sold

.60 * 810,000

486,000

 

 

15) The Fence Company needs to determine the amount of its purchases for the month. It has the following information available for March:

 

Cost of goods sold anticipated for March

$10,000

Desired ending inventory for March

$2,000

Beginning inventory for March

$3,000

 

Determine the amount of purchases necessary to achieve the desired ending inventory.

 

 

16) A recent fire destroyed the inventory of The Candle Store. The accountant is preparing an estimate of the loss for the insurance company and has gathered the following from the records of the company:

Beginning inventory$48,000

Purchases71,000

Net sales110,000

Estimated gross profit25%

 

Prepare a schedule to compute the amount of the inventory lost in the fire.

 

17) Puff Company has the following information available for March:

Net purchases$376,000

Net sales revenue$610,000

Beginning inventory$  95,500

Gross profit percentage35%

 

Estimate the cost of Puff’s ending inventory.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

18) Healthy Food, Inc. has the following items for August:

Normal gross profit of 40%

Net sales revenue of $637,500

Net purchases of $289,600

Beginning inventory is $210,800

 

Calculate the ending inventory using the gross profit method.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

19) ABC, Inc. began the year with $250,000 of inventory and purchased $1,500,000 of goods during the year. Sales for the year were $2,750,000 and the gross profit percentage is 45%. Compute the company’s estimated cost of ending inventory by using the gross profit method. How can this estimate be checked for accuracy?

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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