Country Guides Inc The Estimated Ending Inventory for the Second Quarter Is:
A)

question 38

Multiple Choice

Country Guides Inc. uses the gross margin method to estimate its ending inventory for each quarter. The following information for the second quarter was provided from the records: $\begin{array} { | l | l | } \hline \text { Sales revenue } & \$ 200,000 \\\hline \text { Purchases } & 47,500 \\\hline \text { Freight-in } & 1,400 \\\hline \text { Beginning inventory } & 41,250 \\\hline \text { Purchase returns } & 900 \\\hline \text { Estimated gross margin rate } & 72 \text { percent } \\\hline\end{array}$
The estimated ending inventory for the second quarter is:

• A) $30,250
• B) $32,250
• C) $33,250
• D) $35,050

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Definitions:

Noncumulative

Noncumulative refers to a type of preferred stock where dividends do not accumulate if they are not declared or paid in a given dividend period.

Dividends in Arrears

Dividends on cumulative preferred stock that have not been paid in the period they are due.

Balance Sheet

A financial statement that displays a company's assets, liabilities, and stockholders' equity as of a specific date, showing the company's financial position.

Sole Proprietorship

A business structure owned by a single individual, where the owner and the business are legally considered the same.