Question: Inventory was destroyed in a fire. Limited data suggests the normal gross profit rate is 40% of sales. Sales to the date of the fire

Inventory was destroyed in a fire. Limited data suggests the normal gross profit rate is 40% of sales. Sales to the date of the fire were $1,500,000. Beginning inventory and purchases were $500,000 and $700,000 in period prior to fire. The inventory loss is: None of these. $1,200,000. $300,000. $600,000. $500,000.

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