An accounting clerk of the Blakely Company absconded with cash and a truck full of electronic merchandise on May 14, 20X4. The following data have been compiled for 20X4:
Beginning inventory, January 1 ....... $ 55,000
Sales to May 14, 20X4 ........... 300,000
Average gross profit rate .......... 25%
Purchases to May 14, 20X4 ......... 210,000
Compute the estimated cost of the ending inventory and indicate how you could use that value to estimate the cost of the missing merchandise.