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3) A firm experienced a flood loss in the current year that destroyed all but $6,000...

3) A firm experienced a flood loss in the current year that destroyed all but $6,000 of inventory (at cost). Data available are below: Current Prior Year (to Date of Flood) Sales $100,000 $40,000 Purchases 70,000 35,000 Cost of goods sold 60,000 Ending inventory 10,000 What is the approximate inventory lost? A. $10,000 B. $15,000 C. $16,000 D. $21,000 © 2019 Gleim Publications Inc. Inventory 0219 6

4) A flash flood swept through Hat, Inc.’s warehouse on May 1. After the flood, Hat’s accounting records showed the following: Inventory, January 1 $ 35,000 Purchases, January 1 through May 1 200,000 Sales, January 1 through May 1 250,000 Inventory not damaged by flood 30,000 Gross profit percentage on sales 40% What amount of inventory was lost in the flood? A. $55,000 B. $85,000 C. $120,000 D. $150,000

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