During January, Sundown Corporation Had Sales of $300,000 and a Cost

question 16

Multiple Choice

During January, Sundown Corporation had sales of $300,000 and a cost of goods available for sale of $600,000. The company consistently earns a gross profit rate of 45%. Using the gross profit method, the estimated inventory at January 31 amounts to:

• A) $135,000.
• B) $435,000.
• C) $165,000.
• D) $465,000.