Question

Ivanhoe Legler requires an estimate of the cost of goods lost by fire on March 9. Merchandise on hand on January 1 was $41,800. Purchases since January 1 were $79,200; freight-in, $3,740; purchase returns and allowances, $2,640. Sales are made at 33 1/3% above cost and totaled $126,000 to March 9. Goods costing $11,990 were left undamaged by the fire; remaining goods were destroyed. Collapse question part (a) Incorrect answer.

Your answer is incorrect.

Compute the cost of goods destroyed. (Round gross profit percentage and final answer to 0 decimal places, e.g. 15% or 125.) Cost of goods destroyed $Entry field with incorrect answer Click if you would like to Show Work for this question: Open Show Work

Answer 1

Particulars	Amount (in $ )	Amount (in $ )
Opening inventory		$ 41,800
Purchass		$ 79,200
Freight in		$ 3,740
Less: Purchase return and allowances		($ 2,640 )
Cost of goods available for sale		$ 122,100
Sales	$ 126,000
Less: Gross profit	($ 31,500 )
Cost of goods sold ( $ 126,000 / 133.33333333% )		($ 94,500)
Ending inventory		$ 27,600
Less: Undamaged goods		($ 11,990)
Cost of Goods Destroyed		$ 15,610