Question: On December 3 1 , 2 0 2 5 , Pharoah Company's inventory was destroyed by fire. Sales and purchases for the year had been

On December 31,2025, Pharoah Company's inventory was destroyed by fire. Sales and purchases for the year had been $1,560,000 and $974,000, respectively. The beginning inventory (Jan.1,2025) was $173,000; in the past Pharoah's gross profit has averaged 30% of the selling price.
Compute the estimated cost of inventory destroyed by fire.
Estimated cost of inventory burned

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