On March 31 a Company Needed to Estimate Its Ending

question 66

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 cost of goods sold would be:

• A) $19,500.
• B) $63,000.
• C) $60,000.
• D) $58,500.
• E) $20,000.

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