On August 31, 2013, Hurricane Chuck Destroyed Bedford Craft Mart's

question 17

Essay

On August 31, 2013, Hurricane Chuck destroyed Bedford Craft Mart's entire inventory. The following information is available from its accounting records: Required:
Assuming that Bedford estimates the cost of destroyed inventory at $510,000, compute gross profit margin % that Bedford uses in estimating inventory.

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Definitions:

Owner's Drawings

The act of an owner drawing funds from a business in a sole proprietorship or partnership for personal needs.

Capital Account

A capital account is a financial statement that shows the changes in a company’s assets, liabilities, and equity, or an individual part of a nation's balance of payments reflecting net change in ownership of national assets.

Owner's Equity

The residual interest in the assets of a business after all liabilities are deducted.

Liabilities

The sum of all debts and financial commitments a company owes to external parties, appearing on the company's balance sheet.