1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
serious [3.7K]
3 years ago
13

A fire destroyed a warehouse of the Goren Group, Inc., on May 4, 2021. Accounting records on that date indicated the following:

Merchandise inventory, January 1, 2021 $ 1,970,000 Purchases to date 5,870,000 Freight-in 470,000 Sales to date 8,900,000 The gross profit ratio has averaged 20% of sales for the past four years. Required: Use the gross profit method to estimate the cost of the inventory destroyed in the fire.
Business
1 answer:
katrin [286]3 years ago
3 0

Answer:

$1,190,000

Explanation:

The computation of cost of the inventory is given below:-

For computing the cost of inventory first we need to find out the cost of goods sold which is shown below:-

Cost of goods sold = Sales - Estimated gross profit

= $8,900,000 - ($8,900,000 × 20%)

= $7,120,000

Now, the Cost of the inventory = Beginning inventory + Purchase + Freight - Cost of goods sold

= $1,970,000 + $5,870,000 + $470,000 - $7,120,000

= $8,310,000 - $7,120,000

= $1,190,000

So, for computing the cost of the inventory we have applied the above formula.

You might be interested in
Blossom Company purchased equipment on January 1 at a list price of $100000, with credit terms 2/10, n/30. Payment was made with
VikaD [51]

Answer:

the total cost of the new equipment is $105,500

Explanation:

The computation of the total cost of the new equipment is given below:

Total cost of the new equipment is

= Net price + Sales tax + Installation charges + Payment for concrete slab

= [$100,000 - ($100,000 × 2%)] + $3,000 + $1,500 + $3,000

= $105,500

Hence, the total cost of the new equipment is $105,500

6 0
3 years ago
A 2-year bond with par value $1,000 making annual coupon payments of $106 is priced at $1,000. a. What is the yield to maturity
shutvik [7]

Answer:

Explanation:

Face value = 1000

market price = 1000

annual yield = 106

yield to maturity = (106/1000) x 100

= 10.6 % .

8 0
3 years ago
Which of the following is correct with respect to Debt Service Funds?
Verizon [17]

Answer:

C. Debt service funds account for and report financial resources that are restricted, committed or assigned to expenditure for principle and interest for governmental debts except debt of proprietary and fiduciary funds who account for their own interest and principle payments.

Explanation:

Debt service funds are used to pay for principal and interest on certain types of debts. This reduced the risk of debt security that investors face and also reduces the effective rate at which the offering can be sold.

However debt service funds cannot be used for proprietary funds like 400 and 500.

Instead we use Enterprise funds for 400. That is operations similar to corporate enterprise. For example water and sewage utilities.

Internal service funds for 500 used by other funds or departments bin a government in a cost reimbursement basis. For example a food supplier that takes orders and is reimbursed for each order.

5 0
3 years ago
Read 2 more answers
For most people, the purchase of a Ford automobile would employ which type of consumer decision making?
Nostrana [21]

Answer:

Extended decision making

Explanation:

Extended decision making is the decision making which involve the very high level of the purchase, an internal as well as extensive information search which is followed by the complex computation of the alternatives available and thorough evaluation is taken place when the purchase will take place.

So, for most of the people, when the decision of purchase is to be made like for the Ford automobile, the people will choose the extended decision making as it is expensive, infrequently purchased products.

5 0
3 years ago
By lowering production costs, subsidies help foreign competitors gain export markets. True or False
Luden [163]

Answer:

False

Explanation:

Whenever, there will be reduced production costs, due to any reason in the economy, then the goods will be cheaper and accordingly the sale will be in abundance assuming other factors remain constant.

Thus, due to subsidies the cost to producers will be less and then exporters will not be able to get more share as domestic goods will cost cheaper.

Thus, there will not be any gain to foreign competitors in our domestic markets, as they will not get any share extra rather they will loose as a foreign competitor. In fact goods which are exported will also cost low, and therefore, will gain new customers.

Therefore, above stated statement is false.

5 0
3 years ago
Other questions:
  • Concord Company purchased a new machine on October 1, 2020, at a cost of $115,900. The company estimated that the machine will h
    11·1 answer
  • Costs being equal, when a firm has a higher value gap than its competitor, it can be inferred that the firm:
    8·1 answer
  • TopChop sells hairstyling franchises. TopChop receives $50,000 from a new franchisee for providing initial training, equipment,
    13·1 answer
  • On March 5, 2020, Northwest Co. purchased $400,000 in merchandise on account with credit terms of 1/15, n/45. Purchases were all
    14·2 answers
  • You purchase one MMM July 129 call contract (equaling 100 shares) for a premium of $21. You hold the option until the expiration
    6·1 answer
  • Celine has an unwavering belief in her new start-up company. She possesses intense focus and takes un-conventional risks to make
    11·1 answer
  • A company borrowed 10,000 by signing a 180-day promissory note 9%.the total interest due on the maturity date is: (use 360 days
    11·1 answer
  • Berry Corporation has 100,000 shares of $10 par common stock authorized. The following transactions took place during 2017, the
    13·1 answer
  • *<br> What items make an Water based stain?
    6·1 answer
  • Nona Curry started her own consulting firm, Curry Consulting Inc., on May 1, 2017. The following transactions occurred during th
    15·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!