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Estimate harmonys ending inventory at cost

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Question 1: On January 1, The Parts Store had a $470,000 inventory at cost. During the first quarter of the year, it purchased $2,500,000 of merchandise, returned $19,100, and paid freight charges on purchased merchandise totaling $33,600. During the past several years, the store's gross profit on sales has averaged 30%. Under the assumption the store had $1,920,000 af sales during the first quarter of the year, use the gross profit method to estimate its inventory at the end of the first quarter.

Question 2: During 2020, Harmony Co. sold $520,000 of merchandise at marked retail price. At the end of 2020, the following information was available from its records:

                                             At Cost                              At Retail

Beginning inventory                        $ 127,600                $ 256,800

Net purchases                                   $ 231,240            $ 393,600

Use the retail method to estimate Harmony's 2020 ending inventory at cost. Round all calculations to two decimal places.

Reference no: EM132497369

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