Selected data on merchandise inventory, purchases, and sales for Avalanche Co. and Bridger Co. are as follows:

Instructions
1. Determine the estimated cost of the merchandise inventory of Avalanche Co. on October 31 by the retail method, presenting details of the computations.
2. a. Estimate the cost of the merchandise inventory of Bridger Co. on September 30 by the gross profit method, presenting details of the computations.
b. Assume that Bridger Co. took a physical inventory on September 30 and discovered that $402,600 of merchandise was on hand. What was the estimated loss of inventory due to theft or damage during August andSeptember?

Cost Retail Avalanche Co Merchandise inventory, October 1 Transactions during October: S 98,000 140,000 Purchases (net) Sales Sales returns and allowances 813,200 1,200,000 1,080,000 40,000 Bridger Co Merchandise inventory, August 1 Transactions during Augst and September S150,000 Purchases (net) Sales Sales returns and allowances 1,375,000 1,800,000 100,000 35% Estimated gross profit rate