Suzuki Company lost all of its inventory in a fire on December 26, 2020. The accounting records

Question:

Suzuki Company lost all of its inventory in a fire on December 26, 2020. The accounting records showed the following gross profit data for November and December.

Suzuki is fully insured for fire losses but must prepare a report for the insurance company.

Instructions

a. Compute the gross profit rate for November.

b. Using the gross profit rate for November, determine the estimated cost of the inventory lost in the fire.

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Related Book For answer-question

Financial and Managerial Accounting

ISBN: 978-1119392132

3rd edition

Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso

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Question Posted: Feb 13, 2020 07:25 AM

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Suzuki Company lost all of its inventory in a fire on December 26, 2020. The accounting records

Question:

November December (to 12/26) $600,000 $700,000 Net sales Beginning inventory Purchases 32,000 36,000 420,000 389,000 Purchase returns and allowances Purchase discounts 14,900 13,300 8,500 9,500 Freight-in 8,800 9,900 Ending inventory 36,000

Step by Step Answer:

a Net sales 600000 Cost of goods sold Beginning inventory 32000 Purchases 389000 Less Purchase retur...View the full answer

Financial and Managerial Accounting

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