Brenda Company reported the following information for November and December 2014.
|
November |
December |
|
|
Cost of goods purchased |
$536,000 |
$ 6101000 |
|
Inventory, beginning of month |
130,000 |
120,000 |
|
Inventory, end of month |
120,000 |
? |
|
Sales revenue |
840,000 |
1,000,000 |
Brenda”s ending inventory at December 31 was destroyed in a fire.
Instructions
(a) Compute the gross profit rate for November.
(b) Using the gross profit rate for November, determine the estimated cost of inventory lost in the fire.