On March 31 a Company Needed to Estimate Its Ending

question 168

Multiple Choice

On March 31 a company needed to estimate its ending inventory to prepare its first quarter financial statements.The following information is available: Beginning inventory,January 1: $4,000
Net sales: $80,000
Net purchases: $78,000
The company's gross margin ratio is 25%.Using the gross profit method,the estimated ending inventory value would be:

• A)$82,000.
• B)$60,000.
• C)$20,000.
• D)$22,000.
• E)$19,500.

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Definitions:

Independent Samples

Two or more groups of samples that are collected from independent populations, and where the selection of a sample from one population does not influence the selection from another.

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An expression of the amount of random sampling error in a survey's results, indicating a range within which the true value lies.