The showroom of Sundale Furniture was flooded due to a recent cyclone and its inventory...
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Accounting
The showroom of Sundale Furniture was flooded due to a recent cyclone and its inventory was totally destroyed. Their accounting records were damaged but the following information was salvaged.
Sales revenue (to date this period) $280 000 Beginning inventory (at retail) $50 000 Purchases (to date this period at retail) $430 000 Historical gross profit percentage 40%
Assuming the historical gross profit ratio is maintained the estimated cost of inventory lost in the flood is:
Group of answer choices
a. $80 000
b. $200 000
c. $60 000
d. $172 000
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