Estimating Inventory Using Gross Profit Method

Assume that we are auditing the records of Forde Corporation. A physical inventory has been taken by the company under our observation. The records of the company show the following account data. The gross profit last year was $25\%$ of net sales; we anticipate that it will be $25\%$ for the current year under audit.

$\backslash$table$[[$Sales$,$ gross,$$504,000$