Given the Following, Calculate the Estimated Cost of Ending Inventory

question 100

Short Answer

Given the following, calculate the estimated cost of ending inventory using the gross profit method.
$$\begin{array} { | l | l | } \hline \text { Gross profit on sales } & 28 \% \\\hline \text { Beg Inventory Jan 1, 2017 } & \$ 60,000 \\\hline \text { Net Purchases } & \$ 44,000 \\\hline \text { Net Sales at Retail } & \$ 55,000 \\\hline\end{array}$$

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Definitions:

Cashier's Check

A check guaranteed by a bank, drawn on the bank's own funds and signed by a cashier.

Service Fee

A charge added to a customer's bill for the provision of a service, which might cover operational costs or service delivery.

Forges

The act of creating counterfeit copies of documents, art, or other items with the intent to deceive; also refers to workshops equipped with a forge for metalworking.

Effective

Producing the intended or desired result.