Gross profit method
On January 1, Jasper Store had inventory valued at $124,000. January purchases were $78,000 and January sales were $220,000. On February 1, a fire destroyed most of the inventory. The rate of gross profit was 25% of cost. Merchandise with a selling price of $10,000 remained undamaged after the fire.
Instructions
Calculate the amount of the fire loss. Show appropriate titles for all amounts in your presentation.

Question

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The Answer of Gross profit method
On January 1, Jasper Store had inventory valued at $124,000. January purchases were $78,000 and January sales were $220,000. On February 1, a fire destroyed most of the inventory. The rate of gross profit was 25% of cost. Merchandise with a selling price of $10,000 remained undamaged after the fire.
Instructions
Calculate the amount of the fire loss. Show appropriate titles for all amounts in your presentation.

Gross Profit Method On January 1, Jasper Store Had Inventory Valued at $124,000