When using the gross profit method to estimate ending inventory, it is not necessary to

know:

A$)$ Beginning inventory.

B$)$ Net purchases.

C$)$ Cost of goods sold.

D$)$ Net sales.

A company through no fault of its own, lost an entire building due to an earthquake on May

$1,2024.$ In preparing its insurance claim on the inventory loss, the company developed the

following data: Inventory January $1,2024,$$$460,000$; sales and purchases from January $1,$

$2024,$ to May $1,2024,$$$1,260,000$ and $$935,000,$ respectively. The company consistently

reports a $35\%$ gross profit. The estimated inventory on May $1,2024,$ is:

A$)$ $$636,000.$

B$)$ $$541,000.$

C$)$ $$577,800.$

D$)$ $$576,000.$

A company's inventory was destroyed by a hurricane on August $5,2024.$ At January $1,$ the

company reported an inventory of $$180,000.$ Sales from January $1,2024,$ to August $5,2024,$

totaled $$490,000$ and purchases totaled $$205,000$ during that time. The company consistently

marks up its products $60\%$ over cost to arrive at a selling price. The estimated inventory loss

due to the hurricane would be:

A$)$ $$137,175.$

B$)$ $$78,750.$

C$)$ $$82,750.$

D$)$ None of the other answer choices are correct.

Under the LIFO retail method, the denominator in the cost$-$to$-$retail percentage includes:

A$)$ Net markups and net markdowns.

B$)$ Neither net markups nor net markdowns.

C$)$ Net markups, but not net markdowns.

D$)$ Net markdowns, but not net markups.