To Use the Gross Profit Method to Estimate the Value

question 93

Multiple Choice

To use the gross profit method to estimate the value of the ending inventory,the company needs the following information:

• A)average gross profit rate,net sales,ending inventory,and net purchases.
• B)average gross profit rate,net sales,beginning inventory at cost,and net purchases at retail.
• C)average gross profit rate,net sales,ending inventory at retail,and net purchases at retail.
• D)average gross profit rate,net sales,beginning inventory at cost,and net purchases at cost.

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Definitions:

Price Fixing

A restraint of trade in which two or more competitors agree to set prices for a product or service.

Category

A class or division of items or people with shared characteristics, used for purposes of organization, analysis, or classification.

Antitrust Law

Legislation aimed at preventing anti-competitive practices, monopolies, and other actions that restrict or distort market competition.

Economic Efficiency

A situation in which every resource is optimally allocated to serve each individual or entity in the best way while minimizing waste and inefficiency.