Collins Computers Stored Its Inventory in a Warehouse Which Suffered

question 76

Multiple Choice

Collins Computers stored its inventory in a warehouse which suffered a fire in late November, 2014. Their sales office was at a different location. In order to file a claim with the insurance company, the owners ask you to estimate the inventory in the warehouse. The following information is available: The company's gross profit has historically been 40% of Net sales revenue. Estimate the value of the inventory destroyed in the fire using the gross profit method.

• A)$369,950
• B)$528,550
• C)$410,000
• D)$388,450

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