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Ch 5 practice problems gross profit rate 08s

Ch 5 practice problems gross profit rate 08s - following...

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Practice Problems – Chapter 5 Accounting 207   1.  On January 1, the inventory balance is $100,000.  Our company intends to  increase inventory levels and wants the inventory balance at February 1 to be  $150,000.  We expect net sales for January to be $75,000.  Our company’s gross  profit rate is 30%.  How much inventory should we purchase in January? 2.  Colleen’s Camera Shop was destroyed by fire.  For insurance purposes, she  must determine the value of the inventory that was destroyed.  She knows the 
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Unformatted text preview: following information about her 2008 operations before the fire occurred. Beginning inventory (1/1/08) $11,500 Purchases $62,000 Net Sales $84,000 Gross Profit Rate 30% What is the estimated amount of destroyed inventory? 3. Our company must estimate the inventory balances for its quarterly financial statements. Records show that quarterly net sales totaled $400,000, beginning inventory was $80,000 and purchases totaled $280,000; the gross profit rate is 40%. What is the approximate amount of ending inventory?...
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