Question

Dianna Co. prepares monthly income statements for internal reporting. Because inventory is counted only at year...

Dianna Co. prepares monthly income statements for internal reporting. Because inventory is counted only at year end, month-end inventories must be estimated. The following information relates to the month of September:

Accounts receivable, September 1                                      $121,000

Inventory, September 1                                                         147,000

Collections of accounts during September                            184,000

Purchases during September                                                  165,000

Accounts receivable, September 30                                      127,000

The company uses the gross profit method to estimate ending inventory on September 30. The company uses a 20% mark-up based upon cost. All September sales are made on account.

Question: Based upon the data above, use the Gross Profit Method to estimate the amount of inventory on hand on September 30.

Homework Answers

Answer #1

Please provide rating if found correct :)

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Q.XYZ Co. prepares monthly income statements. Inventory is counted only at year end; thus, month-end inventories...
Q.XYZ Co. prepares monthly income statements. Inventory is counted only at year end; thus, month-end inventories must be estimated. All sales are made on account. The rate of mark-up on cost is 25%. The following information relates to the month of May. Accounts receivable, May 1                                                                            21,000 Accounts receivable, May 31                                                                          27,000 Collections of accounts during May                                                                90,000 Inventory, May 1                                                                                             45,000 Purchases during May                                                                                     58,000 Instructions Calculate the estimated cost of the inventory on May 31.
Exercise 2 (Darnell): Darnell Company uses the gross profit method to estimate ending inventory and cost...
Exercise 2 (Darnell): Darnell Company uses the gross profit method to estimate ending inventory and cost of goods sold when preparing monthly financial statements required by its bank. Inventory on hand at the end of July was $127,000. They estimate a gross profit percentage of 30%. The following information for the month of August was available from company records: Purchases $228,000 Freight-in 6,100 Sales 359,000 Sales returns 9,900 Purchases returns 5,200 In addition, the controller is aware of $10,000 of...
Mark Price Company uses the gross profit method to estimate inventory for monthly reporting purposes. Presented...
Mark Price 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 $ 164,700 Purchases (gross) 651,400 Freight-in 31,400 Sales revenue 1,064,600 Sales returns 82,400 Purchase discounts 13,020 Compute the estimated inventory at May 31, assuming that the gross profit is 30% of sales
Sheridan Company uses the gross profit method to estimate inventory for monthly reporting purposes. Presented below...
Sheridan 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 $ 159,500 Purchases (gross) 593,300 Freight-in 32,900 Sales revenue 974,400 Sales returns 75,900 Purchase discounts 10,800 Compute the estimated inventory at May 31, assuming that the gross profit is 35% of cost.
Buffalo Company uses the gross profit method to estimate inventory for monthly reporting purposes. Presented below...
Buffalo 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 $ 156,000 Purchases (gross) 663,700 Freight-in 31,500 Sales revenue 1,061,800 Sales returns 72,100 Purchase discounts 13,100 Compute the estimated inventory at May 31, assuming that the gross profit is 25% of net sales. Compute the estimated inventory at May 31, assuming that the gross profit is 25% of cost.
Sheridan Company uses the gross profit method to estimate inventory for monthly reporting purposes. Presented below...
Sheridan 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 $ 159,500 Purchases (gross) 593,300 Freight-in 32,900 Sales revenue 974,400 Sales returns 75,900 Purchase discounts 10,800 Compute the estimated inventory at May 31, assuming that the gross profit is 35% of COST. NOT NET SALES
Hornacek Company uses the gross profit method to estimate inventory for monthly reporting purposes. Presented below...
Hornacek 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 $  110,000 Purchases (gross) 620,000 Freight-in 32,000 Sales revenue 1,050,000 Sales returns 70,000 Purchase discounts 18,000 Instructions (a)   Compute the estimated inventory at May 31, assuming that the gross profit is 25% of sales. (b)   Compute the estimated inventory at May 31, assuming that the gross profit is 25% of cost.
Blossom Company uses the gross profit method to estimate inventory for monthly reporting purposes. Presented below...
Blossom 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       $ 160,700 Purchases (gross)       595,100 Freight-in       28,600 Sales revenue       1,028,100 Sales returns       74,200 Purchase discounts       11,600    Compute the estimated inventory at May 31, assuming that the gross profit is 25% of net sales. The estimated inventory at May 31       $ LINK TO TEXT    Compute the...
Vaughn Company uses the gross profit method to estimate inventory for monthly reporting purposes. Presented below...
Vaughn 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 $ 167,300 Purchases (gross) 580,800 Freight-in 32,100 Sales revenue 979,300 Sales returns 73,300 Purchase discounts 11,300 Compute the estimated inventory at May 31, assuming that the gross profit is 25% of net sales. The estimated inventory at May 31 $enter the dollar amount of the estimated inventory at May 31 Compute the estimated inventory...
lint Company uses the gross profit method to estimate inventory for monthly reporting purposes. Presented below...
lint 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 $ 171,100 Purchases (gross) 686,700 Freight-in 28,700 Sales revenue 1,067,400 Sales returns 63,300 Purchase discounts 11,300 Compute the estimated inventory at May 31, assuming that the gross profit is 25% of net sales. The estimated inventory at May 31 $enter the dollar amount of the estimated inventory at May 31 Compute the estimated inventory...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT