Question

Olympic Village Enterprises lost its entire inventory in a hurricane that occurred on July 31, 2014. Over the past five years, gross profit has averaged 30% of net sales. The company’s records reveal the following data for the month of July:
Beginning Inventory ....... $37,100
Net Purchases ......... 294,600
Sales ............ 540,100
Sales Returns and Allowances .. 72,200
Sales Discounts ........ 8,300
Requirements
1. Estimate the July 31 inventory using the gross profit method.
2. Prepare the July income statement through gross profit for Olympic Village Enterprises.


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  • CreatedJuly 08, 2015
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