When a physical inventory count is not possible or cost effective, an estimate of inventory...
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Accounting
When a physical inventory count is not possible or cost effective, an estimate of inventory may be made. When might the gross profit method of estimating inventory be used?
When inventory can be salvaged for sale after a hurricane.
When inventory is destroyed by fire or other catastrophe.
When the proceeds from insurance coverage of inventory have been received.
When inventory has a consistent mark-up.
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