Compute the estimated inventory at May

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Question - Indigo Company uses the gross profit method to estimate inventory for monthly reporting purposes. Presented below is information for the month of May.

Inventory, May 1 $163,800

Purchases (gross) 651,200

Freight-in 29,500

Sales revenue 925,900

Sales returns 66,700

Purchase discounts 11,300

Required - Compute the estimated inventory at May 31, assuming that the gross profit is 25% of net sales.

Reference no: EM132956414

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