Franklin Co. has experienced gross profit ratios for 2016, 2015, and 2014 of 34.00%, 29.25%,...
70.2K
Verified Solution
Link Copied!
Question
Accounting
Franklin Co. has experienced gross profit ratios for 2016, 2015, and 2014 of 34.00%, 29.25%, and 31.25%, respectively. On April 3, 2017, the firm's plant and all its inventory were destroyed by a tornado. Accounting records for 2017, which were available because they were stored in a protected vault, showed the following:
Sales from January 1 thru April 2
$
146,330
January 1 inventory amount
63,210
Purchases of inventory from January 1 thru April 2
118,988
Required:
Calculate the amount of the insurance claim to be filed for the inventory destroyed in the tornado. (Hint:Use the cost of goods sold model and a gross profit ratio that will result in the largest claim.) (Do not round intermediate calculations
Answer & Explanation
Solved by verified expert
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
