ABC Inc Had Net Sales of $120,000 During 2013

question 137

Multiple Choice

ABC Inc. had net sales of $120,000 during 2013. Its finished goods inventories were valued at $20,000 on January 1^st, 2013. During the year, $60,000 of goods was purchased for resale. The company has a gross profit percentage of 40%. What was the company's estimated inventory at December 31^st, 2013 under the Gross Profit method?

• A) $8,000.
• B) $72,000.
• C) $48,000.
• D) $60,000.

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